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Texas rewarded by reverse gold rush

Texas and other states are benefitting from a continued mass exodus from California as people and businesses relocate from the Golden State in search of new opportunities.

Large companies, including Tesla and Hewlett Packard Enterprise (a subsidiary of HP), recently announced they would switch their headquarters to the Lone Star State from California.

U-Haul data confirms mass migration

New information from moving equipment company U-Haul shows that many more moving trucks left California than entered the state in 2020. Which states are growing due to this so-called “Reverse Gold Rush,” as labeled by the U-Haul survey? Here are the top five:

  1. Tennessee
  2. Texas
  3. Florida
  4. Ohio
  5. Arizona

U-Haul says its 2020 survey is the first time Tennessee finished first, while Texas came in second for the fifth time. Previously, the Lone Star State saw the largest increase in moving vans for three years in a row before Florida came in first in 2019.

Tax structure and coronavirus are seen as factors

Experts say the COVID-19 pandemic has encouraged many Californians to leave the state. Of those leaving, some are heading back to their hometowns due to lost jobs. Others want to take advantage of working remotely free of the state’s high cost of housing and long commutes.

Another significant reason for where they’re headed is a lack of a state income tax in Texas and Tennessee, as well as those states’ reputations for being “business-friendly.” Tesla owner Elon Musk announced his company’s move in December, saying California has taken innovators for granted.

He could also be moving for tax reasons as his 18% ownership of the auto company is worth billions of dollars in income. While Musk didn’t say where he is personally moving, many suspect it will be close to Austin, where a new Tesla factory is being built. Also, the headquarters for his SpaceX company is nearby.