Entertainment employment in the greater Los Angeles area took a big hit during the writers’ and actors’ strikes, according to a study released Thursday by the Otis College of Art and Design in conjunction with Westwood Economics and Planning Associates.
But the strikes were not the only causes of the contraction, the report found.
The study — which measured the economic impact of the twin walkouts on the local film and TV industry — recorded a 17% decrease in employment since the Writers Guild of America went on strike in May. Just before the work stoppage began, about 142,652 workers were employed in Hollywood, per the Bureau of Labor Statistics. As of October, that number had dropped to 117,853.
Actors and writers experienced the sharpest decline in employment during the strikes, while camera operators, editors, sound and lighting technicians and other crew members also experienced a reduction in job opportunities, the report says.
The writers’ and actors’ strikes — which ended in September and November, respectively — undoubtedly took a major toll, hampering development and stalling production on big studio releases for about six months. In the third quarter of 2023, production on TV dramas, comedies and pilots was down nearly 100% compared with the previous year, while feature film shoots plummeted by about 55%, the study says.
Due to the production shortage, the report estimates that entertainment industry workers based in the L.A. area collectively lost more than $1.4 billion in wages between April and September, which amounts to roughly .5% of what Hollywood employees make annually.
Not every corner of the entertainment industry waned amid the strikes, however. Directors, producers, agents, artists and managers saw some employment growth during the work stoppages, according to the Otis report. Certain executive positions also saw more hiring activity.
The study speculates that this effect could be due in part to striking actors and writers who wear multiple hats in the industry being forced to focus more on directing, producing and other types of endeavors during the work stoppages. It also posits that a larger amount of visual effects and animation artists might have been hired when actors weren’t available to perform onscreen.
But there are other non-strike-related factors to consider when examining the overall trajectory of the film and TV business, the study shows.
“This study confirms what we have all seen and heard anecdotally over the last year: a notable contraction in the Hollywood economy,” Patrick Adler, principal at Westwood Economics and Planning Associates, said in a statement. “The decrease in entertainment employment predates the strikes, and so despite relief that they have nearly resolved, widespread challenges remain.”
According to the study, 26% of entertainment jobs were cut between August 2022 (when employment rates peaked following the global health crisis) and October 2023. Based on this larger downward trend, the study concludes that the fallout from the era of Peak TV may be impacting the job market more than the labor actions.
The study found that the dramatic increase in TV production leading up to and during the streaming boom resulted in an excess of small-screen content that probably won’t be sustainable moving forward.
Since they were created in an attempt to keep up with the times and compete with Netflix, many streaming services have consistently lost money, investors have become more conservative and a number of streamers have slashed their production budgets, the report explains.
Because of financial losses sustained by media companies both during and prior to the strikes, the study projects that a return to 2022 levels of production or employment is unlikely.
The report also identified the use of artificial intelligence in filmmaking — a key sticking point during strike negotiations — as a “looming threat to employment in Hollywood.”
In addition to the WGA and performers union SAG-AFTRA fighting to secure protections around the use of AI in their new contracts, a spokesperson for crew members union IATSE recently urged lawmakers to take action to defend entertainment workers against the rise of AI in a plea to the U.S. Congress.
“AI developers cannot be allowed to circumvent established U.S. copyright law and commit intellectual property theft by scraping the internet for copyrighted works to train their models without permission from rightsholders,” Vanessa Holtgrewe, assistant department director of movie and TV production at IATSE, said last month during an “AI insight forum” held by the Senate.
The Otis study concludes that it is too early to predict just how big of a danger AI and machine-learning tools pose to workers, as the technology will likely replace some jobs while also creating new ones.