CFCE Blog

California's Foreign Trade Falters

By Loren Kaye
Posted 5/03/2007

Traded goods bring the most value to an economy – and usually create the best jobs.  California used to be the leading state in international trade.  But not any longer.  This change is a reflection of changes elsewhere in the economy as the state continues to hemmorhage high value manufacturing and information sector jobs, only to see them replaced with low value personal service, retail and government jobs. 

According to TradeStates, until the collapse of the technology bubble in 2001, California was the nation’s leading exporter.  Since then, Texas has claimed those bragging rights – and not just in petrochemical industries.  California still leads the country in computer exports, but Texas is now the leading exporter of transportation and electrical equipment, machinery, plastics and fabricated metals.  And it is gaining fast in high tech equipment exports.

California’s overall share of US exports has dropped from over 15 percent in 2000 to 12 percent last year.  During that same period, Texas’ share has increased to 15 percent of the nation’s exports.

Computer exports had been California’s golden goose.  According to the Public Policy Research Institute, manufactured information technology products in 2000 accounted for more than half of all California’s goods exports and almost 44 percent of the output of California IT manufacturers.  Today, computers account for just over a third of all goods exports.  California’s market share of national computer exports has dropped from more than 30 percent in 2000 to less than 24 percent in 2006.

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