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Arizona Commerce Authority CEO Sandra Watson on the factors drawing businesses to Arizona from states such as California.
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Recently Texas governor Rick Perry came here to California fact in some businesses in the Golden State to leave altogether and relocate down to Texas.
That may be a bit much for some people especially California you say how are you -- But there are businesses which if not relocating are certainly opening up shop in other states and as a whole bunch of reasons -- the doing that.
To discuss why they're doing that and one of the states that's been successful in getting businesses to expand that state.
Arizona's -- Watson from the Arizona comments authority joins us -- to discuss it if president.
CEO and is it just -- countries just tax is that businesses think about when they consider expanding.
Outside California -- says it's that -- partly it's labor.
And access Kelly good quality labor is it critically important that the success of their business in in our discussions we've different people they've told us that labor costs of the number one factor that business is considered for an expansion actually relocation.
Richard having discussions with businesses that might be looking at -- Unita I -- you can't name them.
What are they saying as -- why they would consider leaving California is the largest economy in the United States.
Bob thanks to ease of doing business in -- state so as not very is saying -- low regulatory environment that we have pro business climate as well.
Accommodation and the tax environment regulations and as well as labor and in Arizona -- open for business.
62% of business leaders here in California responded to a survey by saying that this state California is very difficult which to do business and -- look at some of the businesses which have expanded to Arizona for instance silicon valley bank.
On ten excuse me.
-- -- communications integrated technology group Alexis oil.
And of course -- Intel invested 300 million dollars recently.
Into expanding.
Facility in Chandler Arizona they could've done that here they ever give you reason why they didn't do it and they did Arizona.
-- -- -- on our governor and the legislature have really had an aggressive pro business.
Heads and and and we have -- aggressive R&D tax credit program in Arizona as well as.
Continuing to reduce the tax liability.
And enhance labor opportunities.
Recent Los Angeles Times editorial actually criticized state officials here in California.
Saying that they don't do enough here in California.
To help business to retain business we interviewed ahead of the Fairfax County.
Recruiting office at the -- Gordon in which he said that's -- that what's going on here and they actually had what.
-- California from Virginia that -- -- California for Virginia he said that this state the reason it's easy.
For perhaps offices like -- and he is to approach business is that California he's just totally ignoring their business community.
-- and found that that doesn't mean is very much engaged end announcing -- pro business environments.
How they work hand in hand with the governor as well as -- legislature to ensure that we got the right tax policies and.
Place not tax policies are important but at the end of the day the number one reason when you speak to economist when you speak to business people the number one reason business actually relocate somewhere else.
Release expands somewhere else.
Has to do with one being here marking your clients but the cost of labor and one of the things that drives the cost of labor is the cost of housing.
Different statistics all say the same thing people leave not businesses -- people leave the state because of the cost housing.
California right now.
Is seeing population -- and not coming and there's a net outflow population.
And I want to show you statistic about housing costs Phoenix 159000.
Dollars the median price for single family of San Jose California.
535000.
Dollars eventually that is going to continue to drive up the cost of labor in California and I would imagine make it easier.
You get businesses to expand if not -- NASA actually -- -- as an incredible Marquette on that incredible place to live.
As you -- and affordable housing scene.
Great amenities and so -- to -- great place for your employees to work.
To live to play.
-- did we talk about the costs of business the median price square foot for commercial real estate.
Phoenix twenty bucks San Jose to a 51 -- let me ask you a bit of a difficult question here.
Why -- businesses leaving California why isn't just based on.
Well I think.
That -- happen.
Companies are looking at opportunities in -- to expand their operations looking at other markets and so with Arizona our close proximity to California.
We have companies numerous companies that we're talking to you today that are interested in expanding their operations -- -- companies expand their operations into other markets.
They tend to.
May bring other opportunities -- to those marketplace so we start with an expansion and ultimately.
At some point in the future we see further expands.
I think I can't think of the full name of the company to paint company famous -- out west done.
It done paint they -- -- done and Edwards they recently expanded terrorism did they not.
-- that they did not move the headquarters of they're still in Los Angeles where they've been from a 100 years.
Is there potential that they might one day -- they have -- discussion -- the I don't know if you can talk about this is that companies.
Right well we we talked to a number of companies we have not to -- up.
Spirit that.
Poignantly I'm good businesses every day about opportunities in Arizona.
We're also working with Arizona companies -- looking to access.
Markets and what with that might change opportunities here.
What do you think is the biggest threat to business in California it seems that both sides of the political spectrum agree that regulations and taxes -- -- problem here.
Is that the biggest threat or is -- the fact that the middle class statistics show this the middle class and lower income are moving out of.
Point well in Arizona I think our -- our proximity our strategic location.
Right next sort of the ninth largest economy in the world.
I guess -- -- on a great value proposition so from my perspective we have businesses who are interested in looking at Arizona is a viable market place to reduce their costs.
Access a great labor -- and be successful.
And I would imagine that -- when people talk about skilled labor is there much of a difference between the -- skill level have you looked at the skill level of people in Arizona vs people in California is it on -- Ayers a different.
Oh absolutely we've got amazing talent in Arizona -- got.
-- went alleges that university systems and the country where at ASU we have largest community college.
In America but -- -- we haven't incredible instituted post as secondary institutions that.
Are making sure that we got the workforce of the future.
And so let's start to wrap this up I had a conversation with the chief economist hopefully everyone knows what you from real estate.
He was telling me that there are 9000 jobs lost not people -- jobs positions he can't you people -- people -- one position depending on the industry.
But 9000 jobs a year California loses.
But -- people California don't seem to be upset by that because they have eighteen million jobs throughout the -- you know 9000 over ten years 90000.
They don't see that is a threat you think they're making a mistake.
We and I think every -- has -- about get this job dad went when he went.
-- -- the governor and the state lawmakers insert that arizonans have jobs.
It was Sandra Watson from the Arizona commerce authority thank you you know there is -- is many years ago was successful -- -- a Canadian.
Data Phoenix and that would be said we appreciate you being here and -- have much more on this throughout the day -- -- on the Fox Business Network but also.
On foxbusiness.com.
