State Attracting More People, Study Says

California is seeing its first net influx of population from other states since the early 1990s recession, but harder-hit Southern California continues to bleed residents to the rest of the country, according to a study.

The findings by the Center for Continuing Study of the California Economy is a sign that the state’s economic growth is outpacing the nation’s as a whole. But some analysts on Thursday questioned the results, arguing that the jury is still out on state migration.

The study, based on an analysis of driver’s license data, projects that California’s net gain in domestic population will exceed 25,000 this year, the first year of such growth since 1991.

“These data show that people are beginning to respond to the improved job growth in California,” said Stephen Levy, director of the Palo Alto-based think tank.

The figures do not include immigration from foreign countries or population growth from births. The state’s total population is about 32 million.

In Southern California, however, domestic migration was still negative: 77,000 more people moved to other states than moved in in the fiscal year ended in June. Levy projects continuing reductions in out-migration from Southern California in 1997 and 1998.

“L.A. was the hardest hit and has still not recovered all of its lost jobs,” Levy said.

Still, the latest Southland out-migration was down from 99,000 in fiscal 1995 and 127,000 in fiscal 1994, a sign that the local economy is picking up. Levy projects continuing reductions in out-migration from Southern California in 1997 and 1998.

Separately, the U.S. Census Bureau on Thursday projected that California’s population would grow by 932,000 people by 2000, making it the third-fastest-growing state in the nation after No. 1 Texas and No. 2 Florida. Other projections:

* California’s Latino population is expected to double between 1995 and 2025 and account for a third of the total Latino population in the U.S.

* California will also have the largest share of the nation’s non-Latino Asian and Pacific Islander population (41%) in 2025, followed by New York (9%), Hawaii (6%), New Jersey (5%) and Texas (4%).

Some economists were skeptical of the projections.

UCLA’s Anderson Business Forecast does not project net positive domestic migration to California until 1998.

Joe Mattey, a senior economist with the Federal Reserve Bank of San Francisco, has done his own analysis of driver’s license data and says the state’s net loss of domestic population still amounted to more than 250,000 in the fiscal year ended in June.

The analysis “suggests . . . [that] the extent of net domestic out-migration was much slower than in the previous year but had not yet returned to zero,” he said. “I would be skeptical that we could reach that in the next year or so.”

For its part, the state Department of Finance, the agency charged with demographic reporting, is withholding judgment on the migration issue until it has more complete data.

“At this point, we’re saying it’s too close to call,” said Ted Gibson, the department’s chief economist. “Certainly, the situation has stabilized, and I don’t think we’re getting net out-migration anymore.”

The confusion arises in part because data on migration patterns are spotty.

“To argue that the rate of migration is recovering and will continue to do so is completely reasonable,” said David Hensley, an economist at Salomon Bros. in New York. But, he added, “No one really knows what the current level of migration is, and that’s the only thing one might quibble about.”

One weakness in driver’s license data is that other states underreport the number of people who have moved there from California, analysts said.

Meanwhile, the U.S. Census Bureau, the other principal source of migration data, relies on income tax returns that are 18 months to 2 years old.

Other economic data are conflicting. On the one hand, job growth in California is indeed outpacing the rest of the nation.

As of August, the state had created 300,000 more jobs than a year earlier, at a pace of about 25,000 more jobs a month, the state Employment Development Department reported. New job figures to be released today are expected to show that trend continuing.

But the state’s unemployment rate remains above the national average, though it fell in August to 7% from 7.8% the year before. The nation’s unemployment rate was 5.1% in August and 5.2% in September.

In Los Angeles County, the situation is even worse. Though the county added 81,800 jobs as of August, the unemployment rate here was still 7.7%, compared with 7.9% a year earlier.

Other data on new housing construction continue to show a slump in that industry, suggesting that demand for new housing--as might be expected with a surge in new arrivals from other states--has not increased.

The Federal Reserve’s Mattey says California’s long-standing pattern of domestic immigration argues against a strong net gain.

The bulk of California’s new arrivals from other states have historically been young people starting their careers and educations.

Migrants to other states, principally those in the Pacific Northwest, have tended to be older people looking to improve their lifestyles. The changes in the U.S. population as a whole tend to favor a trend toward out-migration, Mattey said.

Other findings by the Center for Continuing Study of the California Economy:

* More people will move to California from New York, Massachusetts, Michigan and Illinois. State immigrants to Oregon, Utah, Colorado and Washington should fall this year.

* The Bay Area will lead the gain in state in-migration, having gained 21,300 people in fiscal 1996. San Diego and Sacramento will also see strong gains.