Job growth in California but Hollywood economy lags

150 150 Ed Coghlan

Film crew in downtown Los Angeles (Photo credit: John Guenther)

There were more jobs created in California, than any other state in June. Over 38,000 new jobs were created, which is a promising sign, although the overall unemployment rate for the Golden State remained at 10.7 percent. Also, as this story outlines, job growth in May was actually higher than originally estimated.

One of California’s best known and important interests, entertainment, is continuing to struggle with competition from other states and countries. FilmL.A., the nonprofit organization that coordinates permits for filmed entertainment shot on-location in the city of Los Angeles and other parts of L.A. County, said that overall production slipped slightly in the last quarter compared to 2011.

The L.A. region, which practically invented the TV Drama, saw a dramatic drop in production, 39 percent from a year ago. TV production jobs are a staple of Southern California’s economy, and the more shows that are shoot outside of the area, the fewer jobs are available.

The Governor and the State Legislature landed some criticism over the continuing trend of what is called “runaway production”, which is when production flees to other states to receive better tax breaks and incentives.

“Television production has been our bread and butter, but with Sacramento’s inaction to stem our losses, other states and countries are eating off our plate,”said FilmL.A. President Paul Audley.

The California Film and Television Tax Credit Program, which brought five state-qualified television projects to Los Angeles last quarter, did little to prop up the ailing category. State-qualified projects, including Major Crimes, Pretty Little Liar, Rizzoli and Isles and Switched at Birth, did help.

There is some good news out there. On-location feature production increased 9.1% and TV commercials increased 28% for the quarter. The upcoming Olympics, and the need for fresh commercial content by advertisers, was a big reason for the spike in commercial production.

When the California Economic Summit convened in May, it was designed to spur job creation in California and to increase the state’s ability to compete on a global basis. As one television executive reminded us, sometimes job creation is best done by preserving jobs that are already available. Keeping entertainment jobs in California is job creation.

We’ll be looking more at this particular industry, pending action in Sacramento and other elements in the coming weeks.


Ed Coghlan

All stories by: Ed Coghlan