What's happened
Hollywood is experiencing a significant decline in film and television production, with output down over 30% in recent years. Industry figures, including Ben Affleck, highlight the impact of tax incentives in other states and countries, prompting concerns about job losses in California's entertainment sector. The trend raises existential questions for the industry.
What's behind the headline?
Key Factors Behind the Decline
- Tax Incentives: States like Georgia and New Mexico offer more attractive tax rebates, drawing productions away from California.
- Labor Costs: Increased costs in California have made filming abroad more appealing, as seen with shows like Fox's trivia contest filmed in Dublin.
- Job Losses: The International Alliance of Theatrical Stage Employees reports a loss of approximately 18,000 jobs in California's entertainment sector over the past three years.
Implications for the Future
- Existential Crisis: Industry insiders describe the situation as an 'extinction event' for Hollywood, with many fearing for the future of local jobs.
- Global Competition: As international filming locations become more popular, California risks losing its status as the entertainment capital of the world.
- Need for Reform: There is a growing call for California to reassess its tax incentive programs to remain competitive in the global market.
What the papers say
According to Business Insider UK, Ben Affleck criticized California's film tax incentives, stating they are not competitive compared to other regions like the UK, which attract major productions. He noted that California's production days fell by over 20% in early 2025, exacerbated by the January wildfires. Meanwhile, the New York Times highlights the frustration among industry workers, with producers increasingly opting for international locations due to lower costs. This trend has led to a significant decline in local jobs, with FilmLA reporting a 31% drop in television production and a 29% drop in feature films. Bloomberg corroborates these figures, emphasizing the urgent need for California to adapt to the changing landscape of the film industry.
How we got here
The decline in Hollywood production has been attributed to rising labor costs and more favorable tax incentives offered by other states and countries. This shift has led to a significant number of productions relocating overseas, impacting local jobs and the economy.
Go deeper
- What are the main reasons for the decline in Hollywood production?
- How are tax incentives affecting film production locations?
- What impact does this have on local jobs in California?
Common question
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What is Causing Hollywood's Production Crisis?
Hollywood is facing a significant production crisis, with output dropping by over 30% in recent years. This decline raises important questions about the future of the industry, job security in California, and the long-term effects on film and television. Below, we explore the key factors contributing to this crisis and what it means for the entertainment landscape.
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