Entertainment industry workers and executives say Los Angeles is losing film and television jobs to other states and countries as high costs, complex permitting and more aggressive tax incentives pull productions away from Hollywood.
By yourNEWS Media Newsroom
Hollywood’s century-long dominance as the center of American film and television is facing renewed pressure as productions increasingly leave Los Angeles for other states and countries offering lower costs, easier logistics and larger financial incentives.
Industry insiders told Variety that the trend has accelerated since the streaming boom ended in 2022, with the United States losing 73,000 production jobs. Two-thirds of those losses have occurred in Los Angeles.
The concern has become so severe that some entertainment workers are comparing Hollywood’s trajectory to Detroit’s decline after auto manufacturers shifted jobs to lower-cost regions and foreign markets.
“This is supposed to be the film capital of the world,” said Noelle Stehman, co-founder of the grassroots group Stay in L.A. “It should be the cheapest and easiest place to film. In fact, it is the most cumbersome and the most expensive. That cannot continue. If we don’t do something quickly, this is going to become the next Detroit.”
Los Angeles remains home to an unmatched concentration of entertainment talent, crews, studios and infrastructure. But producers say that advantage no longer automatically makes the city the default place to film.
Production costs in Los Angeles are higher than in many competing markets, in part because of the region’s cost of living, union agreements, permitting requirements and logistical challenges. At the same time, countries and states across the world have built their own production workforces while offering rebates and tax credits designed to attract film and television projects.
The global competition is significant. Variety reported that 81 countries now use filming incentives as economic development tools. The United Kingdom alone spent $2.2 billion on film and television subsidies in 2024, often stacking national incentives with local rebates.
Charles Roven, co-founder of Atlas Entertainment and producer of “Oppenheimer” and “Wonder Woman,” said California’s incentive program is not competitive enough for many productions.
“In my understanding, California’s rebate is one of the least beneficial for anybody who is financing motion pictures and television,” Roven said. “It’s capped and it has no above-the-line.”
Gov. Gavin Newsom doubled California’s film and television incentive program to $750 million in 2025, but industry figures and political candidates are debating whether the state must go further. Some want the program expanded to cover above-the-line salaries for actors, writers and producers.
California politicians are also pushing for federal action.
Sen. Adam Schiff, D-Calif., has been working on legislation that would create a federal film incentive. He argued that the issue goes beyond local jobs and affects America’s cultural influence worldwide.
“In order to save this industry in America, we need to be competitive with tax credits,” Schiff said. “We have a lot of our influence around the world as a result of American film and TV. We don’t want to lose that soft power.”
A draft bill circulated by Schiff would create a 15% federal labor credit, roughly comparable to Canada’s program. The Motion Picture Association has pushed for a 20% credit, plus 5% bonuses for filming in disaster areas or enterprise zones. Because of recent fires, all of Los Angeles County would qualify under that structure.
Supporters say the credit would stack on top of state incentives, similar to systems used abroad. However, no bill has been introduced. Schiff said as of June 4 that Republican lawmakers were waiting for “smoke signals from the White House.”
President Donald Trump brought national attention to the issue May 4, 2025, when he threatened a 100% tariff on foreign-made films. Although Variety described the idea as likely illegal and impossible to implement, some in Hollywood viewed it as evidence that Trump recognized the problem.
Scott Karol, who is working on the issue with actor Jon Voight, one of Trump’s “Hollywood ambassadors,” said supporters are seeking a statement from the president indicating he is open to congressional action on a federal incentive.
“We’ve been working very hard to get an affirmative statement out of the president that he’s open to Congress looking at a federal incentive,” Karol said. “We think that will open up the floodgates, and you’ll see a caucus of bipartisan politicians that will come out in support of this.”
Some Republicans are reportedly open to participating. Rep. Brian Jack, R-Ga., is said to be willing to cosponsor the bill in the House, though other Republicans appear to be waiting for White House direction.
Rep. Laura Friedman, D-Burbank, defended the idea of federal support at a March hearing.
“Hollywood is not asking for special treatment,” Friedman said. “This is something that is standard in the United States across industries that we have determined that we care about.”
Actor Zachary Levi, who voted for Trump, also backed the idea.
“This is good for the economy,” Levi said. “This is not a handout. We want to be able to lead the world in telling great stories, and I think the president does too.”
The pressure is visible in major productions. For every show filming in Los Angeles, another is being produced somewhere else.
NBC’s reboot of “The Rockford Files,” a series about a Los Angeles detective, will still be set in L.A. but is filming outside Atlanta. Netflix’s new version of “Little House on the Prairie,” which premieres in July, was shot in Winnipeg, Manitoba, even though the original was filmed in Simi Valley, California.
Canada’s incentives helped attract the project. Manitoba offers a 30% incentive, while Canada adds a 16% labor credit. Producers also benefited from lower costs, a favorable exchange rate and available soundstages. Winnipeg’s landscape also provided panoramic scenery that matched the show’s Midwest setting.
The shift has affected other familiar titles. “Scrubs” filmed for nine years in the San Fernando Valley during its original run, but the reboot is being produced in British Columbia.
“It is an absolute creative bummer to me that I’m shooting that show in Vancouver,” said creator Bill Lawrence. “It was a shock to my system. I wasn’t prepared for a show that existed, first and foremost, here to be cost prohibitive here.”
Feature films are moving as well. The original “Beetlejuice” was shot in Los Angeles, while the 2024 sequel was made in the United Kingdom. “The Social Network” filmed in Los Angeles and other locations, while the upcoming “The Social Reckoning” was made in Vancouver. The original “Spaceballs” filmed in Los Angeles, while “Spaceballs 2” was shot in Australia.
“The studios want you to make everything for less money,” said Brian Grazer, whose Imagine Entertainment is producing “Spaceballs 2.” “You’re forced to go out of the country to make it for less money.”
Even Georgia, which became a major competitor to California during the 2010s, is facing its own slowdown. Production in Georgia is down nearly 50% from its 2022 peak despite an uncapped incentive that covers above-the-line costs. “Avengers: Endgame” was made in Atlanta in 2017, but the new “Avengers” films are being made in London.
The United Kingdom’s incentive program is especially attractive because it can cover upfront salaries for actors, writers, directors and producers. For productions with a U.K. partner, it can also cover back-end pay.
“I call it the gift that keeps on giving,” Roven said. “If the project that you’re doing actually starts to make money, that rebate percentage is paid back to the company when they pay profit participants.”
Independent filmmakers face similar pressures. Brady Corbet’s “The Brutalist,” set in Pennsylvania, was filmed in Hungary. His next film, “The Origin of the World,” is set in California but will be filmed in Portugal and South Africa.
“It’s much cheaper making films elsewhere than it is here,” said producer David Kaplan. “To pull off a film that looks like it costs multiple times what it actually does, you have to go somewhere where you get that financial trade-off.”
Some productions leave the United States to avoid higher labor costs and union requirements. IATSE jurisdiction is limited to North America, and employers often pay far less for health care overseas.
“I love working with unions. They serve a great purpose,” said production finance consultant John Hadity. “But there are rules, minimums, all that stuff. Labor doesn’t work that way in other countries. In Europe and the U.K., there’s a lot more flexibility.”
Producer Lori McCreary said the Prime Video Civil War series “The Gray House” was filmed in Romania because it cost far less than shooting near Richmond, Virginia, where the story is set.
“If we could have shot it in and around where it took place in Richmond, Virginia, at anywhere close to the same budget, we would have stayed in America,” McCreary said. “It was two-thirds, or less, the cost.”
McCreary said Romania did not require some crew positions that would have been mandatory in the United States.
“Those are all very good jobs for Americans that I’m not able to provide when I’m shooting something overseas,” McCreary said. “I would much rather put all of these people to work in America.”
Labor leaders argue that workers should not be forced to compete with countries where wages and benefits are lower.
“We can’t turn the entertainment industry into a minimum-wage job with no benefits just so we can compete with Bulgaria,” said Mike Miller, vice president of the International Alliance of Theatrical Stage Employees. “Our federal government has to acknowledge that and has to step up.”
Miller, who grew up in Cleveland, said he sees parallels between Hollywood’s current struggles and the decline of major manufacturing industries.
“I watched the demise of steel and rubber and automotive manufacturing as I grew up,” Miller said. “This is identical in many ways. We have an undeclared trade war that our government is standing by and watching happen.”
The downturn has spread beyond film crews. Corri Levelle, CEO of Sandy Rose Floral in North Hollywood, said her business, which supplies silk and fresh flowers to film sets, has been cut in half.
“I’m down 50%,” Levelle said. “We’ve had ups and downs in business, but it’s gone on too long. We can’t survive.”
Restaurants and other local businesses have also been affected. Chef Michael Cimarusti announced the closure of Connie & Ted’s in West Hollywood this spring, part of a wave of restaurant closures following the 2023 writers and actors strikes.
“We had a lot of crew folks that were regulars who simply were not able to afford to dine out the way they used to,” Cimarusti said.
Los Angeles is still a major production center. ProdPro counted 81 film and television projects in California in the first quarter of 2026, more than any other U.S. location, though down from the prior year. FilmLA, the regional permit office, says Hollywood remains the world’s largest production hub.
Some productions still choose Los Angeles when stars or creative demands require it. Apple’s “The Studio,” produced by Seth Rogen’s Point Grey Pictures and Lionsgate, was sold with the understanding that it had to be shot in Los Angeles.
“The show is really about people yelling and screaming at each other in beautiful places,” said James Weaver, president of Point Grey Pictures. “That was an important part of the ethos of the show. Apple knew that when they said they would make it.”
The show received a $13 million California tax credit for its second season.
Lawrence, while filming the “Scrubs” revival in Vancouver, is also producing four Warner Bros. Television shows in Los Angeles.
“I’m very lucky in that I try to shoot everything in Los Angeles,” Lawrence said. “I just think it’s really important to maintain this place as the hub of the television industry.”
California provides nearly $50 million per season to Lawrence’s shows alone. Stars such as Harrison Ford on “Shrinking” and Kathy Bates on “Matlock” can also push for productions to remain in Southern California.
Still, the cost issue persists. Studios are increasing health contributions in current union negotiations, making the United States less competitive with countries that provide national health care.
“It’s not like our labor here in L.A. is overpaid — they’re fairly paid,” said “Baywatch” producer Michael Berk Bonann. “If cost is the only factor, then every single production will eventually leave. You’ll lose something much bigger in the process.”
Bonann considered filming the new “Baywatch” reboot in Australia or South Africa, where beaches and incentives made both locations attractive. He ultimately chose Los Angeles, saying the show belonged there.
“You have to really want to shoot in L.A.,” Bonann said. “It costs more money, but you have to find a way to make that work. This show belongs here.”
After meetings with public officials, Bonann said the show avoided parking and permitting problems, actors were allowed to drive on the beach and the production received a 20% discount on city parking fees.
“I just saw the first cut,” Bonann said. “I cannot imagine having produced an episode of TV this good anywhere else in the world.”
The comparison to Detroit remains debated. Hollywood still produces film and television, just as Detroit still produces cars, trucks and SUVs, though with fewer workers than before.
“It’s oversold that the auto industry left Michigan,” said James Hohman, director of fiscal policy at the Mackinac Center for Fiscal Policy. “Michigan is the top-producing auto state, and it’s not especially close either.”
Michigan kept much of its auto industry with billions in subsidies over 25 years, and the federal government has also treated auto jobs as important to the national economy. Some Hollywood advocates argue the entertainment industry now needs similar support to remain globally competitive.
The issue has become central in California politics. Los Angeles mayoral candidates have debated who is responsible for the city losing production work. Councilmember Nithya Raman accused Mayor Karen Bass of failing to cut red tape, citing “Baywatch” as an example of city and county coordination problems. Reality television figure Spencer Pratt, who exited the race, criticized California’s incentive program and said, “Even Massachusetts has better tax credits than Hollywood.”
Bass said she remains confident Los Angeles can retain its entertainment industry after the disruption caused by the streaming revolution settles.
“I don’t feel like we’re going to lose our industry,” Bass said. “When all of that settles, I feel confident that we can maintain our industry.”
For now, industry workers say Los Angeles faces two related challenges: other regions are making production cheaper and easier, while Hollywood’s own cost structure, permitting system and business environment make it harder to compete.
Unless those problems are addressed, advocates warn that more productions will continue leaving California, taking jobs, local business revenue and cultural influence with them.
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