Los Angeles' entertainment industry suffers continued losses over past three years, report says

As part of a widely recognized and concerning shift, the film and television industry in Los Angeles suffered substantial economic losses over the past three years — a result of the changing landscape of the industry as well as the growth of global competitors, according to a report released Wednesday.

From 2021 through 2023, the greater LA area captured a smaller and smaller share of qualified film and TV projects on a worldwide scale after decades of dominating the industry. Nearly 23% of all qualified projects were shot in LA in 2021 but that number declined to 22% in 2022 and fell even further in 2023 to just 18%, according to the 22-page report from FilmLA, a nonprofit and the official film office of the city and county of Los Angeles. 

While LA continues to be the location for most projects, the report states, it is losing more work to global competitors such as Georgia, New York, the U.K. and Ontario, Canada.

"Although Los Angeles remained the top filming destination among all scripted content released in 2023, its overall market share/capture declined compared to previous years," the report states.

Last year, labor strikes by SAG-AFTRA and the Writers Guild of America brought production in Hollywood to a halt, impacting the industry's output across the board. And the industry has suffered losses on a broader level beyond what's being seen in California.

Globally, film and television projects in the active filming phase went down 7% in the first quarter of 2024 compared to the same period in 2023, according to research from ProdPro, a firm which collects data on the entertainment industry. 

Technological advancements has impacted the field of entertainment much like they have other industries in years past. Shifts in how streaming services operate, for instance, compared to traditional media has changed the landscape of production. Economists say it's all led to a broader decline worldwide — even as theatrical releases saw strong gains last year amid two widespread, simultaneous labor strikes, according to the report.

"What's disrupting the future for entertainment industry workers is much like what began convulsing U.S. manufacturing decades ago: new technology that has transformed the business and reduced the need for workers, as well as the rise of cheaper production sites elsewhere in the U.S. and abroad," the Los Angeles Times reported earlier this year. 

Hollywood, long the heart of film and television production worldwide, has lost more and more jobs in recent years, according to the new FilmLA report and other economic analyses.

In Los Angeles County, employment in the entertainment industry reached its lowest level in over 30 years, according to an analysis of U.S. Bureau of Labor Statistics by the Times, which reports high living costs in California have contributed to other filming locations cutting into LA's longheld share. Georgia, for instance, has been luring in a growing number of projects with tax incentives — bringing in an estimated $4 billion in 2023, according to state officials. 

Meanwhile, the report says the number of streaming series releases shot in LA dropped by 27.9% last year but that decline was just 14.7% industry-wide. When it comes to TV movies — a category dominated by British Columbia with Los Angeles still remaining the No. 2 destination — the number of these projects in LA decreased by 14.9% while there was actually an increase of 10.5% across the industry.

When the strikes took hold last year, the LA region's share of employment in film and television nationwide fell to 27% from 35% just the year before, according to a report released in May of this year by the Otis College of Art and Design in LA, called "Die Another Way: Hollywood Transformed in the Streaming Era." 

But that report also notes that some shifts are more a product of how media has evolved as a whole in the digital age.

"Los Angeles is still the apex of the entertainment industry, but the industry itself is undergoing once-in-a-generation changes," Dr. Patrick Adler, economist and assistant professor at The University of Hong Kong, said in the report. "It is less dependent on film and television studios, more oriented towards online content creation, live events and gaming, and also much more technical and managerial than ever."

"What it means to work in Hollywood is starkly different today than even 10 years ago," Adler said in the report.

And, according to the FilmLA report, Los Angeles continues to dominate the industry on a global level despite what the report describes as "significant losses" in recent years. In California, the entertainment industry fed about $43 billion in wages into the state economy in 2023, the report states. 

Still, FilmLA president Paul Adley said there remains concerns for the industry's future in the state. "But how long can California subsist – or help businesses and families thrive -- on an ever-thinner slice of a shrinking production pie?" he said in the report.

The report suggests financial incentives from the government to keep the industry alive. Earlier this year, a $4.1 million grant program for small and micro businesses affected by the 2023 Hollywood labor strikes and the COVID-19 pandemic was introduced by the Los Angeles County Department of Economic Opportunity and the County Film Office.

More such government incentives are being advocated by FilmLA as a means of holding onto LA's position as the entertainment capital. 

"Audley and others worry that California's loss of global production share risks more than international bragging rights," the report says. "Hollywood's coveted leadership in entertainment production was achieved over a century of new business investment."