Dan Walters

Opinion: California-Texas economic rivalry still rages

Pumpjacks operating at the Kern River Oil Field, in Bakersfield, Calif. California’s top regulators on Tuesday, March 10, 2015 acknowledged lax oversight by the state had allowed oil-and-gas industry contamination of protected water aquifers and other threats to public safety, and pledged to intensify protection of water sources and public health.
Pumpjacks operating at the Kern River Oil Field, in Bakersfield, Calif. California’s top regulators on Tuesday, March 10, 2015 acknowledged lax oversight by the state had allowed oil-and-gas industry contamination of protected water aquifers and other threats to public safety, and pledged to intensify protection of water sources and public health. AP

California is the nation’s most populous state with about 39 million residents, while Texas is No. 2 at 27 million.

California is a true blue state politically, while Texas is among the reddest of the red when it comes to politics.

They also are rivals in many spheres outside of politics, from cuisine to music. But no competitive arena is more contentious than economics.

California tops all states in economic output at $2.3 trillion, while Texas is second at $1.6 trillion. Their economic drivers are similar in many respects – technology, medical care, agriculture and energy.

California is No. 1 in agricultural output, while Texas is No. 2.

Texas is the No. 1 state for petroleum production, while California is No. 3.

Each month, when the federal Bureau of Labor Statistics releases new employment data, the California-vs.-Texas rivalry gains new fodder.

Last month, when the BLS announced revised data for 2014, several economic analysts pointed out that California, which had been clobbered by the Great Recession, had finally surpassed Texas in the creation of new jobs.

Steve Levy of the Center for Continuing Study of the California Economy led the cheerleading, in an analysis entitled “California Vaults over Texas in Job Revisions.”

“In the December 2014 report,” Levy wrote, “Texas led California in 12-month job growth by 458,000 to 320,000. But the revised estimates released today show that California added 498,000 jobs in the 12 months ending January 2015 compared to a downward revised 393,000 for Texas.”

Other analysts quickly pointed out that even with the revision, Texas’ employment had increased by 3.5 percent in 2014 while California trailed at 3.2 percent.

Texas’ population and labor force are only two-thirds of California’s, so its seemingly smaller job numbers could translate into a higher growth rate.

The BLS released employment data for March on Friday and Levy was back, acknowledging that Texas had created jobs faster in 2014, but adding “no more.”

“The California job surge continued in March with the addition of 38,800 jobs and a decline in the unemployment rate to 6.5 percent,” Levy wrote. “California’s job growth rate for the past year (3.1 percent) now exceeds the Texas growth rate (2.9 percent) as the state lost 25,400 jobs in March.”

There is, however, a caveat with that analysis. Even though it dropped to 6.5 percent in March, California’s jobless rate is still among the highest in the nation, while Texas’ unemployment rate declined to 4.2 percent, one of the nation’s lowest rates.

Despite the state’s job growth, 1.2 million of California’s 18.9 million-worker labor force are still unemployed, while Texas has just 558,943 unemployed in its 13.1 million-worker labor pool.

The debate, therefore, continues.

Call The Bee’s Dan Walters, (916) 321-1195. Back columns, sacbee.com/dan-walters. Follow him on Twitter @WaltersBee.

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