Hollywood’s Struggles Continue Despite Efforts to Revive Industry

California Governor Gavin Newsom recently stated that Hollywood is gradually recovering its former shine, having faced years of production companies moving away from Los Angeles for more affordable locations. However, industry professionals suggest that the reality is far from positive, citing ongoing challenges and a notable drop in production levels.

Jay Ellison, who owns Shadowcast Pictures, voiced his concerns, stating, “We need a massive rescue, and we need it now.” He and others in the industry are witnessing major studios opting for filming sites beyond California, including places like Canada, the UK, and even domestic options like Georgia and New Mexico.

In Los Angeles, scripted TV productions have decreased by nearly 30% since 2019. David Ellison, CEO of Paramount Skydance, has begun contemplating moving the company’s headquarters, which would mean substantial production funds leaving California.

Entertainment attorney Jonathan Handel pointed out that the struggles Hollywood currently faces have been a long time coming, spanning three decades. Jason Fischer, CEO of StageRunner, noted that a trend toward relocating productions began more than 20 years ago. He mentioned, “For the last two years, production has moved slowly and then rapidly, leaving California… and nothing was actually done until it was too late.”

Several well-known television shows are now filmed outside California, like Paramount’s “Landman” in Fort Worth, Texas, and Netflix’s “Stranger Things” in Atlanta. Despite efforts to keep productions in Los Angeles, the financial advantages of shooting elsewhere are hard to ignore.

Fischer reflected on past discussions at his studio about keeping shows local, noting that the potential for significant savings elsewhere often wins out. “When we can save millions by going somewhere else, there’s no choice,” he explained.

The downturn in production has had a real impact on California’s economy, with over 80 production and service businesses in Los Angeles shutting down since 2022, linked to job shortages and strikes. Industry jobs have plummeted over the years, leading to large-scale consequences beyond just filmmaking.

Ellison remarked, “It’s a huge disruption, affecting not only production companies but also restaurants and local businesses that depend on the industry.” His own rental company, Shadowcast Pictures, had been in operation for about 20 years before closing its doors after attempting to keep afloat through financial hardship.

Job security is a growing concern for many in the industry. “Insiders who once worked extensively on sets now find themselves lucky to work a few days a month,” Ellison said. Many are looking for stable roles in ongoing TV series rather than the unpredictable nature of the current landscape.

Compounding these issues, the iconic Television City studio in Los Angeles, where many famous shows were produced, is facing potential sale due to persistently low production activity. The situation is dire, and some insiders wonder if the industry can even be labeled a true “industry” in the next couple of years.

Despite the turmoil, Newsom has promoted California’s film and television tax credit program as a way to entice production back, suggesting that it will bring $6.6 billion in direct production costs to the state. “The world we created is now competing with us… We need to enhance our offerings,” he stated while discussing incentives last year.

Experts believe that state leadership has been slow to react to the challenges facing the industry and remain skeptical that Newsom’s incentives will restore Hollywood’s leadership role. “Incentives have brought some production back, but it’s not sufficient when competing with other countries,” Ellison noted.

Fischer echoed this sentiment, asserting that while some progress has been made, much work remains. “California is the most expensive place to film, and getting the right incentives is still a huge hurdle,” he stressed.

Improving financial incentives alone may not be enough, as other locations, particularly Atlanta, have built the infrastructure and experience needed for competitive filming environments. Ellison suggested that Los Angeles needs to catch up quickly, as other regions are increasingly appealing to filmmakers.

In a closing note, both Ellison and Handel expressed cautious optimism about the future. “I think rebuilding is possible, but it demands immediate action,” Ellison said, emphasizing the urgency of the situation. Whether this will lead to a revitalization of Hollywood remains to be seen.