The governors of the Golden State and the Sunshine State don’t agree on much, but their states have at least one thing in common: Their sources of tax revenue are under pressure.
Many economists foresee a slowdown and possibly a national recession in 2024, though some of them say they expect California and Florida to fare better than the nation. Nevertheless, residents of both states are worried about their personal finances, jobs and inflation, some polls show.
Tech firms and other companies are continuing to cut jobs in California, which faces a budget deficit and relies heavily on personal income taxes for revenue. But there’s hope: After months of slow job growth, California led the nation in jobs added in October with 40,200. That represented 26.8% of all U.S. nonfarm payroll jobs added for the month.
California’s unemployment rate inched up from 4.7% in September to 4.8% in October.
Florida’s unemployment rate is 2.8%, and the national unemployment rate is 3.9%.
Florida does not have a state income tax and is largely dependent on tourism tax revenue. That revenue is under pressure because of the state’s politics, though the state says the number of visitors to the state shows it’s doing just fine.
New laws, including those that restrict abortion rights and school curriculums, have led to travel advisories and convention cancellations amid accusations that Florida is hostile to members of the LGBTQ community, women, people of color and immigrants. As part of the culture wars going on in the state, Gov. Ron DeSantis also is sparring with Disney, a huge source of jobs and revenue. A recently released Disney-backed study says the Walt Disney World Resort generated more than $40 billion in economic activity in the state in 2022.