in Industry Employment, Another Strong Year at Box Office
Despite a boost from California’s film incentive program, runaway TV/film production remains a significant threat
Los Angeles, CA — A new study released today by the Los Angeles County Economic Development Corporation’s (LAEDC) Kyser Center for Economic Research predicts a modest increase in industry employment in 2010.
The report also forecasts another strong year at the box office, no foreseeable labor issues, and a boost in production from California’s film incentive program.
Other pluses include NBC’s programming of scripted series in the 10:00 p.m. primetime spot being vacated by Jay Leno and the ongoing investment in the entertainment industry’s infrastructure such as NBC Universal’s Evolution Project and the Disney/ABC Studios at the Ranch. However, key issues include changes in the business model, with an intense focus on costs. Run-away production remains a significant threat and changing technology, distribution, exhibition and marketing models are noted. The media industry will continue to struggle, reflecting a slow rebound in advertising and changes in the way consumers access information.
The LAEDC study recommends a renewed focus on entertainment as a serious business because it is a high-wage, high-multiplier activity. The study cited efforts by the cities of Los Angeles and Santa Clarita to become more “film-friendly.” It also recommends watching the state’s film incentive plan that has helped boost employment in this sector.
“The coming changes in how the industry operates also need to be monitored,” said LAEDC
Founding Economist Jack Kyser. “At the end of the day, content is still king and leaders need to be alert so that much of it is still produced in the County.”
Entertainment: The TV/film production industry had a good year at both the domestic and international box office in 2009. However, this box office bonus did not translate into jobs. In 2009, there were an estimated 9,000 industry job cuts, reducing the total from 141,400 in 2008 to 132,400 jobs.
The slump was blamed on the economic impact of lingering labor issues, run-away production and major changes in the industry’s business model.
Television (broadcast & cable): This sector is facing major challenges in its business model, due to changes in the way consumers access content and their willingness to pay for it. A declining pool of advertising dollars compounds the problem. According to the LAEDC study, broadcast TV employed 9,185 people in the County in 2008, while the cable and subscription TV industry had a local work force of 6,707 people. Employment in both sectors declined during 2009. A significant challenge for both broadcast and cable TV is the growing audience appetite for on-demand TV, and their unwillingness to pay for the content.