As California lawmakers debate closing the state’s budget deficit, Chamber of Progress released a new report on Tuesday illustrating how the state’s social safety net depends on the health of California’s technology industry.  

Authored by Chamber of Progress Senior Economist Kaitlyn Harger, the report finds that taxes paid by California’s tech industry, including employee income taxes and corporate taxes, contribute over $20 billion each year to state government revenue, with $2.6 billion in annual growth. The report estimates that the $2.6 billion in tax growth supports over 20,000 more jobs, directly and indirectly, each year.

Read the Report: 

California’s Social Safety Net Depends on a Healthy Tech Industry

Top findings in the report include:

• The tech industry’s state tax liability stands at $20.4 billion, with an annual average growth of $2.6 billion. Over a five-year period, California tax revenue from the tech sector grows by $14.3 billion.
• The additional $2.6 billion in tax revenue growth from tech adds $916 million for K-12, $614 million for health services, $266 million for higher ed, and $270 million for social services to the California budget.
• Overall, the $2.6 billion in annual tax revenue growth supports 20,577 jobs in California each year.
• The additional spending in K-12 education directly supports 7,341 jobs annually or 41,865 jobs over a five-year period.
• The additional spending in healthcare directly supports 2,591 jobs on an annual basis and 14,773 across a five-year period. 
• The additional spending in higher education directly supports 2,132 jobs on an annual basis and 12,160 across a five-year period. 
• The additional spending in healthcare directly supports 1,308 jobs on an annual basis and 7,457 across a five-year period. 

“At a time when California is facing a significant budget deficit and preparing to cut spending, few Californians understand how a thriving state tech economy helps

support the state’s social safety net,” said Chamber of Progress CEO Adam Kovacevich. “While some leaders criticize the state’s tech industry for exacerbating inequality in the state, the reality is that the better that the tech industry is doing, the more social services California can offer its residents.  To keep paying teachers and social service workers, California needs tech.”

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Chamber of Progress (progresschamber.org) is a center-left tech industry policy coalition promoting technology’s progressive future.  We work to ensure that all Americans benefit from technological leaps, and that the tech industry operates responsibly and fairly.  

Our corporate partners do not have a vote on or veto over our positions. We do not speak for individual partner companies and remain true to our stated principles even when our partners disagree.