California’s Chief Export? Some Say Industry Jobs : Manufacturing: Great weather, an educated labor pool and a Pacific Rim location can no longer make up for the high costs of doing business in state, a seminar hears.

Just two years ago, manufacturing employment in Southern California was still growing, and such people as Jim Renzas had a hard time getting government officials to listen to their warnings about an industrial exodus out of the state.

But then Los Angeles and Orange counties both lost manufacturing jobs last year. And Renzas--vice president of Paragon Decision Resources, an Irvine firm that studies relocations for businesses--is a sought-after speaker at seminars on California’s growing problem of manufacturing flight.

Such a seminar was held here Thursday, sponsored by the California Assn. for Local Economic Development. The Renzas message wasn’t all that uplifting.

Many businesses in California, particularly manufacturers, have reached the point where they believe that the great weather, educated labor pool and Pacific Rim location can no longer make up for the high costs of doing business in the state, speakers said.

While many of the problems can be cured, or at least lessened, neither government nor industry has made much progress to date, panelists agreed.

Renzas, for example, told the audience of about 125 business executives and economic development officials from around the state that he has prepared relocation studies for 40 California firms since 1986. In almost every case, he concluded that the companies would be better off moving out of the state.

Barry Sedlik, who heads Southern California Edison Co.’s customer retention program, said the utility is working to keep 75 of its industrial customers from moving out of state.

Together, those firms employ nearly 16,500 Southland residents.

While that may not sound like an unbearable burden in a region with a population of about 17 million, the cost to the state and local economies if all those jobs are lost could easily top $500 million, according to an economic study by the Midwest Center for Labor Research.

Much of the discussion at Thursday’s seminar dealt with finding new ways to handle such problems as high corporate taxes, steep housing and labor costs, increased environmental regulation and growing traffic congestion.

To that end, Gov. Pete Wilson sent Julie Wright, director of the state Department of Commerce, to the seminar to tell agency officials and business leaders that the state realizes that there is a problem and intends to resolve it.

Wilson is determined “to turn the business climate around” and show businesses that California wants them and is willing to work with their officers to resolve problems, Wright said.

It will take a lot of work by the state, said Wilford Godbold, president and chief executive of Zero Corp. in Los Angeles and chairman of a California Chamber of Commerce project, Saving California Jobs.

In his opening address, Godbold--whose company is relocating two of its nine California subsidiaries to Salt Lake City--blamed an inattentive Legislature for many business problems, especially the soaring cost of worker compensation premiums and health care programs.

Explaining why Zero moved two businesses, Godbold said the $200-million-a-year manufacturer of electronic cabinetry and airline shipping containers was pinched by costs and decided to look into the cost of doing business in eight nearby states.

“Moving to Salt Lake cuts our worker’s compensation bill by 60%, and we get a higher level of benefits for our workers,” he said.

Equally important, Godbold said, officials in Utah and several other states made his company feel wanted.

Godbold contrasted that with the experience of Lockheed Corp., which set out in early 1989 to build manufacturing plants in South Carolina, Utah and California.

“The one in South Carolina was built in 14 months,” Godbold said. “The one in Salt Lake City took 16 months. In California, it has been 28 months, and Lockheed still doesn’t even have the building permit.”