California ‘exodus’ in 2020 never happened, new study says

Rise in cost of living and pandemic had been blamed for supposed relocation of tens of thousands

Reports of the “California exodus” were greatly exaggerated, a new study finds. (AFP via Getty Images)

Earlier this year, reports abounded that tens of thousands of people were leaving California, spurred by the pandemic and high costs of living, in a phenomenon that became known as the “California exodus.”

According to a new study, it never happened.

“We find no evidence of a pronounced exodus from the state,” researcher Natalie Holmes wrote in a report for the California Policy Lab.

Overall, Californians left the state in 2020 at about the rate at which they were expected to do so, according to trends since 2004. What was unusual, the study found, was that fewer people moved in to replace them.

“Historically, the number of people leaving California tracks the number of people entering California,” Ms Holmes wrote, “but this pattern deviated in Q4 2020, when 267,000 people left the state and only 128,000 entered.”

The Lab based its study on a set of data called the University of California Consumer Credit Panel.

Fear of an exodus had driven concerns about the state’s tax revenue, which some feared would suffer if too many rich Californians picked up and left. But despite a few famous examples of tech industry leaders fleeing the state – Elon Musk, for example, announced that he was moving to Texas last year – overall that hasn’t happened, the study found.

“Despite concerns about tax revenue impacts, there is little evidence that wealthy Californians are leaving en masse,” Ms Holmes wrote.

Most of the moves the study found were within California, from one town or city to another.

But while there was no exodus out of the state, the report said, there was one specifically out of San Francisco.

“At the county level,” Ms Holmes wrote, “San Francisco is experiencing a unique and dramatic exodus, which is causing 50% or 100% increases in Bay Area in-migration for some counties in the Sierras.”

Exits from the city during the pandemic were 31 per cent higher than during the same period in 2019, the study found – and instead of making up for them, new entrances were 21 per cent lower.

In general, however, the much-feared prophecy of a state running out of people has not come to pass, even if the picture within that state is complex.

“While a mass exodus from California clearly didn’t happen in 2020, the pandemic did change some historical patterns,” Ms Holmes wrote.