A factory closes, and California seems to shrug
In a state of almost 40 million people and a workforce of more than 18 million, the announcement that 1,100 workers are losing their jobs shouldn’t be a big deal. Except that it is.
It matters that a factory is closing. It matters that the owner, Aerojet Rocketdyne Inc., has been in operation in Rancho Cordova since 1951. It’s troubling that the Sacramento region, which relies too heavily on government payrolls, is losing skilled manufacturing jobs.
It leaves us to wonder what blueprint California leaders actually have for the Sacramento region. The list of companies that have left is too long. Waste Connections relocated to Texas in 2011. Campbell’s closed its Sacramento soup plant in 2013. Verizon eliminated 1,000 call-center jobs last fall. Some companies have moved in. But what is the plan?
We cannot stop thinking about Lucid Motors, a California startup that bypassed Sacramento for Arizona. Lucid will build electric vehicles, which it will sell in California in part because of taxpayer-funded incentives that California taxpayers offer to zero-emission vehicle purchasers. What do taxpayers get in exchange?
We don’t blame Lucid for choosing Arizona, just as we couldn’t blame California-based Tesla Motors for locating its battery factory in Nevada. Nevada Gov. Brian Sandoval and Arizona Gov. Doug Ducey provided generous incentives and shovel-ready land. California has many charms; low corporate taxes and light regulation are not among them.
Aerojet Rocketdyne’s decision to relocate its headquarters last year to the Southern California city of El Segundo should have been a red flag. Brown administration officials insist they fought to keep the factory open. But the company’s business was such that it felt it had to act. Perhaps no amount of last-minute persuasion could have reversed the decision. But that’s where the lack of a plan matters.
Aerojet will expand in Alabama, where U.S. Sen. Richard Shelby has made it his decadeslong mission to create an aerospace hub in Huntsville. We’re not sure who among statewide leaders makes it a mission to foster good jobs in the Central Valley.
California’s unemployment rate is at 5 percent, less than half of what it was during the awful recession. Silicon Valley continues to ascend, as does coastal Southern California. But the Central Valley stumbles. That ought to matter to California’s leaders more than it seems to.
This story was originally published April 12, 2017 at 12:45 PM with the headline "A factory closes, and California seems to shrug."