Explained | End of the SAG-AFTRA strike: Major implications for Hollywood as actors return to work

Hollywood, that global symbol of glitz and glamour, was brought to a standstill for nearly four months due to the longest strike in the history of the Screen Actors Guild — American Federation of Television and Radio Artists (SAG-AFTRA). From July 14, 2023, to November 9, 2023, the American actors’ union was embroiled in a labour dispute with the Alliance of Motion Picture and Television Producers (AMPTP), leaving a profound impact on the entertainment industry.

This strike, along with the concurrent Writers Guild of America strike, has shaken the very foundation of Hollywood and could have far-reaching consequences for the industry.

Let’s look into the significance of the end of the SAG-AFTRA strike and its implications for Hollywood, covering the economic impact, industry changes, negotiations, and the broader context of the labour disputes in the entertainment world.

One of the most immediate and tangible impacts of the SAG-AFTRA strike is the staggering economic loss it incurred. The strike, combined with the Writers Guild strike that ended in September 2023, resulted in the loss of a massive 45,000 jobs, according to reports.

Moreover, the strike inflicted an estimated $6.5 billion in economic damage to the Southern California region, which serves as the heart of the entertainment industry. This devastating economic fallout had a ripple effect, affecting not only the actors but also thousands of below-the-line workers, whose livelihoods depend on the thriving film and television production industry. Many of these workers were forced to sell their homes or dip into their retirement savings just to make ends meet, emphasising the grim reality of such protracted labour disputes.

The SAG-AFTRA strike was not solely about financial compensation but also about addressing the industry’s changing landscape. Two key factors played a central role in the strike: the rise of streaming platforms and the increasing use of artificial intelligence (AI) in the entertainment sector.

Streaming platforms have transformed the way content is produced and distributed. Traditional compensation models, which involved residuals for actors and writers whenever a show was rerun or sold to a different broadcaster, have been disrupted by streaming giants like Netflix. They introduced buy-out deals, providing a one-time lump sum to talent for their work, essentially eliminating the residual income that was once a significant part of actors’ earnings. SAG-AFTRA, during negotiations, successfully secured a 100 percent bump in performance compensation bonuses for actors working on hit streaming series and movies. This landmark change ensures that the creators receive a more equitable share of the profits when their work achieves certain viewership thresholds, effectively pushing streaming platforms to share their success with the artists who contribute to their content.

Artificial intelligence became another focal point during the strike. Actors and writers were concerned that studios and streamers would use AI technology to scan their likenesses and voice performances without their approval or compensation, essentially creating digital replicas of them for use in new productions.

The strike achieved a crucial victory by imposing restrictions on the use of AI and ensuring that producers would require the approval of the actors before scanning and reusing their performances. This development acknowledges the importance of protecting an actor’s likeness and intellectual property rights in an era where AI can be harnessed to replicate human appearances and voices with startling accuracy.

Historical significance

The SAG-AFTRA strike marks a significant moment in Hollywood’s history. It was the first time in over four decades that actors initiated a labour dispute in the United States, harking back to the 1980 actors’ strike. Additionally, the simultaneous occurrence of the SAG-AFTRA and Writers Guild strikes was a rare event, with the last such instance dating back to 1960. This unusual convergence of labour disputes between actors and writers underscores the gravity of the issues at stake and the collective resolve within the entertainment industry to address them.

The end of the strike is a welcome relief for Hollywood, allowing productions to restart and enabling thousands of workers to return to their jobs. The strike had caused substantial disruptions to major film and television projects, halting the production of popular series like Emily in Paris, The Last of Us, Law and Order, and The White Lotus. It also affected the production of highly anticipated movies, including Gladiator 2, the Avatar sequels, and new instalments in the Transformers, Spider-Man, and Superman franchises. The hiatus in production caused significant delays, reshuffling release schedules and putting immense pressure on studios to make up for lost time.

The end of the strike has broader implications for the industry, particularly concerning the Oscar season. With award contenders now available to participate in promotional activities such as talk shows, magazine profiles, and red carpet events, Hollywood can proceed with its annual awards race. This development is crucial for both the film industry and the awards season, as studios can now present their films and talents to the world, potentially influencing nominations and awards.

While the end of the strike is a cause for celebration, resuming Hollywood’s operations is not without its challenges. As studios and production companies rush to get their projects back on track, there is a risk of a bottleneck. Demand for actors, cinematographers, editors, costume designers, and other industry professionals may outstrip the available supply. This could potentially lead to delays in production, as scheduling and coordinating talent and crews will be more challenging. Nonetheless, these challenges are a small price to pay for restarting an industry that is a significant driver of the American economy.

The conclusion of the SAG-AFTRA strike has signalled a potential power shift within Hollywood. Notably, the creatives—actors, writers, and other artists—seem to have emerged as the winners in this labour dispute. Many of SAG-AFTRA’s demands were met, and the union secured key concessions on contentious issues, including streaming compensation and the use of AI in the industry.

The solidarity within the union played a vital role in the strike’s success. Notable stars like George Clooney, Scarlett Johansson, and Leonardo DiCaprio, alongside rank-and-file members, expressed their support for the strike. This unified front strengthened the position of SAG-AFTRA negotiators and highlighted the determination of industry professionals to protect their rights and interests.

As Hollywood navigates this period of transition and change, the studios find themselves in a precarious position. The International Alliance of Theatrical Stage Employees (IATSE), the union representing technicians and craftspersons, is set to negotiate a new contract with the studios, with the current contract due to end in November 2024. This looming negotiation could potentially lead to another industry-disrupting strike. There need for the studios to reevaluate their strategies and relationships with the creative talent in the industry.