California Faces Worker Exodus as Housing Costs and Taxes Drive Migration

A new report shows the state lost nearly 87,000 professionals in 2023, while gaining only 69,000, with many relocating to lower-cost states like Texas and Arizona.

California experienced a net loss of over 18,000 workers in 2023, with high housing costs and state income taxes cited as key factors.
Popular destinations for departing workers include Texas, Arizona, Washington, and Nevada, all of which offer lower costs of living and, in some cases, no state income tax.
Texas received 14% of workers leaving California, making it the top destination, while smaller states like South Carolina and Montana also attracted significant numbers of job movers.
Despite the exodus, California remains a popular destination for new residents, ranking second nationally for inbound migration in 2024, driven by its economic opportunities and lifestyle appeal.
Experts suggest addressing the state's affordability crisis, particularly housing shortages, is critical to retaining talent and maintaining its economic competitiveness.