texas #2


For those persistent souls seeking to join, or rejoin, the ranks of the employed in the Golden State, here is a word of advice: Don’t mess with California, mess with Texas.

In short, the State of California is currently sucking wind relative to quality job opportunities. Sadly, millions of state residents are suffering mightily as job losses mount, paychecks shrink, and houses are lost.

From Los Angeles to Sacramento, job seekers say finding work has become an exercise in futility. As of this writing, the statewide unemployment rate is 12.2% and rising. Many highly qualified professionals I know, often with advanced degrees, have been out of work for upwards of a year. New graduates are even more disillusioned, many resorting to travel abroad or graduate school until the job market regains some traction. Even the otherwise robust health care industry is not immune, as the pace of hiring for nurses and other health professionals has slowed considerably.

State government jobs, historically a safe haven for those seeking secure employment, have arguably taken the biggest hit. “Furlough Fridays,” a mandate requiring California state workers to take three unpaid Fridays off a month to help mitigate the state’s budget shortfalls, have been particularly devastating to the state’s economy. This has now created a ripple effect adversely impacting local retail establishments that depend on state-worker spending to keep them afloat.

Adding to this madness are the number of unemployed job seekers still holding out for state job openings. So why is this occurring, particularly when the state testing system makes being selected a year-long proposition at best? Applicants would likely say that the perceived long-term security is the heart of their persistence. The problem with this mindset is that the gold-watch days of secure employment and a lucrative pension are likely over. And even if one finds themselves lucky in landing one of these increasingly rare opportunities, the question remains as to whether the perceived long-term security is worth the sacrifices inherent in a contracting state employee pool.

Here’s another interesting aside, this one relative to the private business world: Many of the statewide companies with available jobs are having difficulty finding well-qualified candidates to fill them — an even sadder scenario for the future of commerce in California.There are a number of possible explanations for this, the largest being that the crumbling educational system in California is failing to produce the levels of talent that companies are seeking.

Then there is the state’s anti-business culture, which makes doing business here costly and complex. Medical technology firm Medtronic offers proof of this situation. Earlier in 2009, the company announced it was moving its diabetes products division out of Northridge, California, to a new 150,000 square-foot facility in Texas. Once settled in the Lone Star state, Medtronics plans to hire nearly 1,400 staff over a five-year period. That’s huge! And the reason boils down to simple math: Rumors persist that Medtronic officials found the cost to their company to be $10,000 less per employee per year in Texas than in California.

By the way, it’s now 6:30 a.m. and I’m still on my laptop writing this article from a coffee shop down the road from my house. Seconds ago I exchanged morning pleasantries with a gentleman who then asked me what I was working on. Upon sharing with him that I was writing about the tenuous job situation in California, his eyes lit up. Turns out he was laid off in 2008 and has been out of work for over a year. With no prompting he cites two examples of out of state companies that have purchased failing businesses here. Their state of origination: Texas. “Hum,” I thought. “That’s interesting.”

Here’s the bottom line:  If you’ve got California on your mind in terms of job opportunities or pursuing a start-up business, you might want to think again. So where should one explore? Let’s eliminate Michigan right off the bat. Its 15.2% unemployment rate is the highest in the nation. What about Nevada, California’s neighboring state to the east? Nevada often touts its success in snatching companies away from California’s unfavorable business climate, yet it registers a 13.2% unemployment rate, second highest nationally.

If I had to place my bets on a state in terms of employment and business opportunities, the aforementioned Texas immediately rises to the top of the list. That’s why I contend that job seekers should mess with Texas, not California, or Nevada (at one time the fastest-growing state in the union), or heaven forbid, Michigan.

Why Texas? The pro-business culture has created a high-octane job engine, one where despite workforce cutbacks, 589,500 more jobs exist in the state now than did a decade ago. Its unemployment rate is at 8.1% (compared with the national average of 9.7% and 12.2% in California). And the housing costs there are generally dirt cheap.

According to a recent bizjournal.com survey of the nation’s 100 largest metropolitan areas, four of the five most robust employment markets nationally are in Texas: Austin ranks first; San Antonio is second; Houston is fourth; and Dallas-Fort Worth rounds out the list with a ranking of fifth.

The only non-Texan city in the lineup is third-place Baton Rouge, Louisiana. Speaking of that town, while having a margarita at my favorite Mexican restaurant in Folsom (CA) recently, I struck up a conversation with the person next to me who happened to be from Baton Rouge. He confirmed that all of the quiet fuss about the job market in that area was indeed true. He noted the stable presence of companies like Dow Chemical, Kaiser Aluminum, and Exxon as key to growth in the area. In addition the area is blessed with a major shipping port as well as Louisiana State University, one of the largest higher-education institutions in the nation.

Okay, back to the Lone Star state. Is all of the chatter about Texas, true? I’m scheduled to travel down to the Dallas-Fort Worth area in February of 2010, so stay tuned for the real scoop. In the meantime, the few Texans I’ve talked with have all responded in the affirmative regarding prospects in those parts. For example, a colleague of mine in Fort Worth shared something she observed recently — a growing number of cars in the corporate parking lots have out-of-state license plates, making one wonder if news is catching on about the state’s milk and honey environment. And a retired Texas state official told me that their state prison system is literally begging for employees. Perhaps not the ideal workplace scenario for many folks, but then again it is a job.

Here’s the bottom line: California needs to get its act together quickly or the sucking sound from businesses and job seekers leaving this state is going to get mighty loud. Our state leaders need to step up and develop a comprehensive economic development plan that supports jobs and prosperity because, absent a strategy, why would one want to fool around with California when they can mess with Texas. Go south young lad, go south.