Two days before the devastating fires broke out in Los Angeles, Hollywood was in a celebratory mood as Demi Moore, Zendaya and Timothée Chalamet walked the red carpet ahead of the Golden Globes.
At the glittering parties afterwards, there was excited chatter about the success Wicked and other recent blockbusters — and whether they may herald the end of Hollywood’s deep slump marked by studio budget cuts, writer and actor strikes and falling box office revenues.
A week later, Los Angeles’ most celebrated industry was in shock and again uncertain about its prospects for recovery. “I don’t think anybody knows what’s next,” said the executive of a major movie studio. “This city is going through a lot of trouble.”
Studies in Hollywoodincluding Sony, Disney and Warner Bros, were not damaged by the fire, but many productions from fires whipped by the wind began to spread to densely populated districts.
On the Sony lot in Culver City, new episodes of long-running game shows Danger and Wheel of fortune are suspended. NBCUniversal postponed filming on several television shows last week, including the Golden Globe-winning comedy Hacksbut resumed filming this week. Other studios say they are monitoring the fires and expect them to be up and running soon.
Preparations for the Oscars, Hollywood’s biggest night, were also affected by the fires. The Academy of Motion Picture Arts and Sciences has twice extended the voting period for Oscar nominations, scheduled to air on March 2, to give members more time to consider their choices. The Academy took the extra step of canceling a star-studded luncheon for nominees planned for next month.
Executives think these fire-related disruptions will be temporary, but there are long-term concerns that Hollywood is losing its appeal as a place to shoot movies and TV. Once a world leader in manufacturing, LA has watched other US states, along with Canada and the UK, use tax breaks to take business away from California.
The result is a sharp decline in film and TV production in Southern California over the past five years, said Philip Sokoloski, a spokesman for FilmLA, the group that issues licenses for LA productions.
He said the number of productions in LA has fallen by double digits in every category his company tracks over the past five years. “In some cases, it’s about 50 percent,” he added.
Gavin Newsom, the governor of California, will try to revive the state’s film industry this year — even as he is also investing billions of dollars to help L.A. recover from fires. He plans to introduce a $750 million annual tax incentive plan for the industry in the upcoming state legislative session, more than double the current level.
The goal is to attract productions that have moved to Georgia, Louisiana, New York and other US states with more generous incentives — and try to prevent defections to Canada and the UK. If approved, the stimulus package will take effect in July.
At stake is an industry that generates close to $45 billion in revenue for California each year. At streaming’s peak, LA employed 149,500 people in the motion picture and sound recording industries, according to the Bureau of Labor Statistics. By 2023, when strikes nearly halted production, the figure had dropped to 108,740.
The recovery from the strike that many in the industry had expected last year has not materialized, with filming at times falling below the levels seen during the shutdown. Reality TV shows, usually reliable employers during bad times, have dried up. Stories circulated of Hollywood workers being forced to sell their homes, become Uber drivers or leave the industry altogether. The phrase “Survive until 2025.” it became a mantra for struggling actors, directors and writers.
“Then come 2025 and all hell breaks loose,” said Tom Nunan, an Oscar-winning producer and professor of film at UCLA. “I don’t think the fires will really change the direction of the industry, but it’s definitely a turning point for people [to consider leaving LA]. People are tired of waiting for studios to give them work.”
The fear is that the 100-year-old ecosystem of writers, actors, producers, crew and agents in LA could begin to collapse.
FilmLA’s Sokoloski said, “When you look at people who have had solid careers here who are considering moving out of state to find a job or a whole new job, it says something about the faith and trust people have in this region.”
“When people start considering the possibility of creating their career elsewhere, it is certainly not in our favor,” he added.
Hollywood has welcomed Newsom’s proposal, although some warn it won’t be a magic bullet. British Columbia increased its tax credits on Jan. 1, with additional incentives for productions above $200 million. Credit, combined with a weaker Canadian dollar and its strong manufacturing infrastructure, make Canada an attractive alternative to California, LA-based Entertainment Partners said in a December report.
The group also noted that President-elect Donald Trump’s proposed 25 percent tariffs on Canada could hurt American film and TV production.
For now, the focus in LA is on helping with rescue and recovery efforts. Hollywood studios have donated millions of dollars to emergency relief and rebuilding efforts, and actors including Jamie Lee Curtis are spearheading fundraising efforts for those displaced by the fires.
But restoring faith in Hollywood’s status as the home of the world’s “dream factories” will also require work. “I’ve been in the business since 1984 and I’ve never seen such a prolonged period of despair,” Nunan said. “It started with Covid, then the streaming wars, then the strikes and now this.”
But the 62-year-old Hollywood veteran added: “I’m not ready to give up. I’m not ready to give up.”
