HOLLYWOOD — With film-TV contract talks between actors and studios entering their third week, thesps face an uphill battle to make the case for the need to ease the squeeze on working-class actors.

The initial sessions of negotiations saw the Screen Actors Guild surprise the industry with an aggressive proposal in line with its pledge to salvage the economic health of actors earning under $70,000 a year. But the argument will come under scrutiny with both sides having reviewed first proposals and may not carry much weight.

Companies, already insisting margins are shrinking amid higher costs and a souring economy, will undoubtedly cite the steady rise of SAG’s reported wages for television and film from $776 million in 1993 to $1.04 billion last year for a 36% gain.

“The SAG numbers are about typical of what white-collar workers in California have seen during the past eight years,” said Bruce Smith, an economist with the state’s Dept. of Finance. “The industry has performed far better than the state’s manufacturing sector.”

Jack Kyser, senior economist with the Los Angeles Economic Development Corp., said the salary gains for SAG were well ahead of the economy’s 1.9% inflation rate during the same period. “They haven’t done spectacularly, but they’ve done OK,” he observed.

The SAG figures, based on contributions to the guild/industry pension and health plan, show that TV earnings have risen steadily from $434 million to $624.1 million last year. That’s a compounded annual growth rate of 5.2%, reflecting improved contracts and the expanding TV market.

Volatile film cycle

Feature earnings have been far more volatile in posting a 3.2% compound annual rate, jumping from $342.1 million in 1993 to $455 million in 1996 and then never nearing that peak again. Film salaries plunged back to $399.7 million in 1997, followed by $415.4 million in 1998, $425 million in 1999 and $417.3 million in 2000, reflecting the combined effects of runaway production and tightened film spending.

“The movie business often tends to run on its own business cycle,” Smith noted. “It can be quite counter-cyclical. Sometimes, it’s remarkable how unrelated it is to the rest of the economy.”

The reported SAG numbers do not tell the entire story since they exclude most of what major stars take in. Actual wages of SAG members are not disclosed, since P&H contributions are capped when salaries hit $200,000 on a project.

SAG, which is negotiating jointly with the American Federation of Television & Radio Artists, has logged only four afternoon sessions since negotiations launched May 15 at Alliance of Motion Picture & Television Producers headquarters in Encino. Talks are set to resume Wednesday following a six-day break under a continued news blackout.

Only 2% make over 100K

SAG chief negotiator Brian Walton noted before negotiations started that less than 2% of SAG’s 98,000 members earned more than $100,000 annually. In their initial offer, the actors proposed 5% annual bumps in the minimum SAG pay rates — currently at $617 daily, $2,147 weekly — due to the trend by producers to pay scale plus 10% to cover agent commissions to all actors other than stars.

SAG and AFTRA are also seeking hikes in residuals for the Fox Network, video, cable, foreign TV and made-for-pay-TV; enhanced language on foreign shoots; and tightened restrictions on producers negotiating individual employment deals.