California used to represent more than 50% of our business; that was before the internet bubble collapsed driving that percentage down to almost zero. Now things are coming back, especially in Southern California.
Except for the earthquake, I enjoyed finding out about this recovery while touring our client sites in the Golden State this last week. Worker comp fraud and abuse killed many staffing companies in California during the 2000-2003 period, and I'm glad to report that 100% of our clients survived. I'd like to think that all of our integrated back-office modules including the worker comp module played a role in this, but it probably has more to do with them just being good business people.
One Northern California client survived and is now prospering by largely exiting the industrial business. Their direct hire business has taken off, and they're starting to experience a candidate driven market (i.e., get a good candidate, then figure out where to place him/her).