$200 mil lost, but number of jobs increases

Los Angeles County has lost $200 million in economic activity as a result of the 19-week strike by union actors against advertisers, a local economist has calculated.

The work stoppage is costing about $1 million each weekday in direct costs, such as lost wages for talent and crew along with location spending, according to Jack Kyser, chief economist at the Los Angeles Economic Development Corp.

Kyser also estimated that the strike by the Screen Actors Guild and American Federation of Television & Radio Artists has eliminated over $1 million per weekday in indirect expenditures such as on catering, rentals and construction supplies as well as spending by agencies.

Off-lot filming of commercials in Los Angeles County has slid since the strike started May 1 as producers seek to avoid picketing of nonunion shoots by taking production out of town or onto studio lots. Permitted off-lot August production fell 61%, while July shoots were down 66%.

“The strike is clearly having an impact on the local production community although it tends to get submerged amid the size of the overall Los Angeles economy of $310 billion annually,” Kyser noted. “And if the strike gets settled, we’ll clearly see a burst of economic activity, particularly in auto advertising.”

The economist noted that while the strike’s economic losses have mounted, the industry’s overall employment picture has brightened. The latest state job numbers show that county employment in the film and TV production category has grown 7% during the strike from 134,900 in April to 144,300 in August.

Kyser noted that the state figures probably understate the true numbers by as much as 5% since they often do not reflect jobs performed by freelancers. He said the growth is due to the creation of new high-tech jobs in addition to a boost in local entertainment industry employment resulting from growing worries about next year’s possible strikes by SAG, AFTRA and the Writers Guild of America.

Even though the unions have denied they have specific plans to strike next year, studios and producers appear to be taking that possibility seriously because they have ramped up dealmaking and production in anticipation of a double shutdown next summer.

“If I were in a craft union, I’d be very nervous about next year,” Kyser added. “Even if there are no strikes next year, there’s bound to be a slowdown in the second half because so much production is going to take place in the first half of the year.”

The unions and advertisers differ over the impact of the strike on production outside Los Angeles. The ad industry claims that production is at pre-strike levels, but actors say producers are starting to hold off spots in the hopes of a settlement.

Union officials said they obtained a recent internal Leo Burnett USA memo showing reps for “The Wonderful World of Disney” had decided to delay new spots for that reason. “In light of the SAG strike and the shortage of experienced actors, Disney does not want to compromise the outcome of the spots,” the memo said.

With negotiators for actors and advertisers returning to the bargaining table Wednesday, SAG and AFTRA plan an extensive array of events this week. High-profile celebrities are expected to attend a rally Wednesday at the La Brea Tar Pits in Los Angeles.

Activists also plan to continue hitting hard at General Motors, named three weeks ago as the main corporate target for the rest of the strike because of its refusal to sign an interim agreement with the unions. Demonstrators staged round-the-clock pickets Friday at GM parts plants in Beaverton, Ore., and Santa Fe Springs, Calif., to prevent Teamster truckers from making deliveries.

“We obviously slowed down their activity since they had to bring in a bunch of nonunion drivers,” said Stuart Pemble-Belkin, exec director of the AFTRA/SAG office in Portland. “We wanted to get the word back to Detroit that we are not messing around here.”

SAG and AFTRA also demonstrated Friday at a GM production plant in Pontiac, Mich., where crane operators have honored the picket line. GM officials have continued to insist that the dozens of demonstrations have not impacted operations.

Child actors demonstrated for a second time on Saturday at a McDonald’s in Hollywood.

New York strike leaders reported that Democratic senatorial candidate Hillary Clinton agreed Saturday to endorse the work stoppage and pledged that she will actively support the activities should upcoming negotiations fail to produce a settlement. Strike captain Paul Reggio also said about 1,500 SAG and AFTRA members participated in a labor solidarity march in Manhattan on Saturday. By comparison, only half a dozen union members had participated in the same march a year ago.

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