The United States has seen a remarkable turnaround in manufacturing employment since the economy bottomed out five years ago — but California hasn't.
The state has been among the slowest to recover jobs in an industry long viewed as a bastion of middle-class opportunity.
Since February 2010, U.S. manufacturing employment has increased at a rate of 6.7%, with some Midwestern and Southern states such as Indiana and South Carolina seeing gains of 15% or more. By contrast, California manufacturing has grown at about 1% over the same period.
The Golden State still has the nation's largest manufacturing base. But California's high costs for land and energy are preventing the state from grabbing its share of companies relocating production back to the U.S. from overseas markets such as China.
"It comes down to housing costs and the costs of doing business in California overall," said Jordan Levine, director of research at Beacon Economics in Los Angeles.
That could hurt California's middle-class workforce: Manufacturing is the classic path to higher paying jobs for less-educated workers. On average, manufacturing workers make 8.4% higher wages each week than those in all other industries combined, according to a 2012 Brookings Institution study.
As manufacturing jobs disappear, workers without advanced credentials are far more likely to move down the pay scale into service industries such as retail or hospitality.
The recent national uptick in manufacturing comes after severe cuts that started in the 1990s and continued through the Great Recession. Companies lowered costs by shifting production to cheaper labor markets in China and the developing world.
But in recent years the conventional wisdom has shifted. China's rapid rise as a global economic power has pushed up workers' wages there, eliminating much of the labor cost advantage.
Since 2004, the average wage in China more than tripled, after adjusting for inflation and other factors, compared with only a 27% increase in the U.S., according to a recent study on the so-called reshoring phenomenon by the Boston Consulting Group.
At the same time, the U.S. has seen a boom in natural gas production, bringing down domestic energy costs.
"We're a high-wage country, but that equation is changing," said Michael Zinser, a manufacturing expert and managing director at the Boston Consulting Group.
In the same vein, companies looking to return to the U.S. are confronting regional cost equations — which often don't favor California.
Dorothy Rothrock, who represents California's manufacturing industry, calls it the "flyover effect."
"There's a fresh look at the whole country," said Rothrock, president of the California Manufacturers & Technology Assn. "Unless you're forced to be in California for some reason, increasingly it's hard to find reasons that you have to be here."
Although California is responsible for about 11% of the nation's manufacturing production, the state has accounted for only 1.8% of investment in new or expanded manufacturing across the country since 2001. That compares with 6% in the 1980s, according to economic development data purchased by the association.
In 2013, only 46 manufacturing operations started or expanded in California, the association said, compared with 253 in Texas.
Rob Neenan, who represents food processors tied to the state's enormous agriculture industry, said he has seen similar trends in his sector.
Most of the growth that Neenan is seeing has been in smaller scale specialty-food processing — companies that make particular sauces, ethnic foods or jams, requiring proximity to certain California crops. Further up the supply chain, he said, larger distributors that make pizzas or frozen foods are avoiding California and moving to states such as Nevada, New Mexico or Arizona.
The story is similar with boutique manufacturers like A.L. Johnson Co. in Camarillo, a foundry and machine shop that has been in operation for more than 50 years. The company does individualized castings for clients who are largely in the aerospace and medical industries.
"Say you have a new invention, and want to make millions of these things," said Mark Griffith, the company's president. "You come to us, and we produce maybe 10 or 20."
But you take the contract for millions elsewhere.
Griffith has watched the shifts in California's manufacturing climate through the years. The decline of aerospace in the 2000s hit his company particularly hard, but the new demand for medical technology has helped even out his customer base. Now, with fewer manufacturers in the area, California is not a growth market for his type of work.
"Texas has been a big draw for a lot of companies, particularly those from California, because of the overall lower costs," he said.
It's not that California factories no longer make things — they merely do it with fewer workers. Production output has grown nearly 10% since 2011 even as job growth has stagnated, according to federal data.
The fastest-growing sectors of manufacturing in California tend to be in the higher skilled advanced-technology realm.
For example, nearly a third of California's manufacturing output in 2012 was in the high-end computer and electronics field, where the state is responsible for nearly a quarter of U.S. production. But a much smaller proportion of the state's manufacturing employees, only about 20%, work in that sector.
The same goes for medical equipment manufacturing, which has also had large increases in production over the last five years, but still employs only 4% of state manufacturing workers.
A&M Biomedical in Laguna Hills is a contract medical device manufacturing company, assembling such things as electromechanical devices used in radiation treatment and digital imaging products for the dental industry.
Chief Executive Melissa Fontes said the proximity to clients — Orange County and San Diego are a major hub for the medical device field — is most important for her operation.
"They love the idea that they can jump in their car and be here in five to 10 minutes for a face-to-face meeting," she said.
The company runs a highly efficient operation, using experienced workers who are familiar with reading manuals and design specifications. Fontes acknowledges the higher costs of doing business in California, but said moving elsewhere really isn't an option.
The biggest manufacturing job losses in California since the Great Recession, and over the last decade, have been in more labor-intensive fields such as automobile manufacturing, shipbuilding, textiles and apparel, according to federal data.
In that way, California may be simply ahead of national manufacturing trends — away from people, toward machines — rather than missing out on them, said Jerry Nickelsburg, a senior economist at the UCLA Anderson Forecast.
"It's change that has happened sooner in California," he said. "But it's happening everywhere. Because robots will work three shifts, they don't join unions and they don't complain."