WGA Strike Cost to Los Angeles: $2.5 Billion
Today, the Hollywood Reporter has a story highlighting the economic effects the recently settled WGA strike has had on the local Los Angeles economy. Citing an Economic Forcast Report set to be released today by Jack Kyser, noted LA Economist and head of the LA Economic Development Corp, the article paints a somewhat grim picture of the post-strike LA economic situation.
Among the points made by Keyser in the 71-page report is that the strike, which started November 5 and was settled earlier this month, has already cost LA an estimated $2.5 billion in lost revenue. That figure includes lost wages from TV shows that were canceled and films that were put on hold as well as losses by a vast array of support services from, according to the article, "limo drivers to florists."
Kyser also suggested in the report that the cancellation of the Golden Globes alone resulted in a $60 million loss to the LA economy. In addition, other factors will contribute to the economic situation in LA including, according to the article, that leaders of the Screen Actors Guild are "talking tough," so there is growing concern they will go on strike after the union’s labor contract with the studios expires on June 30.
The report also points out that DVD sales have leveled off, declining last year by 3.4% to $16 billion, and that the TV season, both what’s left of it now and what will come in the fall, has had its schedule completely wrecked by the strike with shows doing what they can to play catch-up and return with new episodes now, later in the season or in the case of Fox’s 24, not until 2009.
However, all wasn’t completely somber and forboding in the report as Keyser did highlight a bit of good news that may help soften the economic blow to LA caused by the strike. The 2007 box office showed strong growth and so did cable television networks. Also, the growing use of the internet for marketing and distributing content could also be a positive factor off-setting the negative economic impact.
So, mostly bad news for the LA economy with some good bits mixed in just so we don’t all decide to move away. Even with the bad news, I’m still happy that people are getting back to work around here under a much better contract .
Sure, the strike has taken its toll and in a perfect world, would not have been necessary. But in the long run, a better situation for writers, who in many cases pretty much get the shaft in Hollywood, can only be better for everyone involved.