Manufacturing is the No. 1 industry in California to pack up and move to states considered to be friendly to business. Since such losses are happening more frequently, it’s time to examine the record of a politician from a district that will soon lose a major employer. In this case, it’s Sen. Connie Leyva, D-Chino, who represents Colton.

Ashley Furniture has announced it will stop manufacturing in Colton and furlough 840 employees.

The company didn’t say that California’s difficult tax and regulatory environment figured into its decision, but I can’t see how any business leader could ignore such factors when deciding to move the work out of state.

A company statement said that closing the facility will strengthen its production capability and cost structure so as to compete effectively.

The work will be transferred to Wisconsin, Mississippi and North Carolina, all of which have reasonable labor rates, lower workers’ compensation costs, a thoughtful regulatory environment and lower energy costs.

I have no connection with Ashley Furniture. But in my experience I’m confident that the company could reduce costs by 20-35 percent for each job moved, helping it to remain competitive in the dog-eat-dog retail world.

Consider the experience of Bing Energy, a “green” fuel-cell company, that relocated its headquarters and manufacturing from Chino to Florida.

Bing CFO Dean Minardi said the “tipping point” in his decision was Florida’s friendlier laws and its move to phase out the corporate income tax. Minardi said of eliminating the tax, “It’s huge. The more income a company can keep the more people it can hire .... I just can’t imagine any corporation in their right mind would decide to set up in California today.”

My firm completed a study — “California Business Departures: An Eight-Year Review 2008-2015” — that estimates more than 3,000 manufacturers diverted capital out of California because of facility relocations, opting for expansions in other states, or deciding to go elsewhere after considering California.

The difficulty of operating here keeps increasing as our politicians (almost always Democrats) repeatedly pass costly measures. More tax hikes. More regulations. More fees. More penalties.

Ashley Furniture gave employees 60 days notice and met regulations governing layoffs. I’m sympathetic and understand why workers may organize a protest in front of an Ashley facility.

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(Source: sbsun.com)