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Diversity in Hollywood Is a ‘Plus Factor for the Bottom Line’ (Study)

Hollywood is failing to present more diverse casts in movies and television — even though doing so would maximize the bottom line, according to a new report issued Tuesday by the Ralph J. Bunche Center for African American Studies at UCLA.

“The problem, as we have pointed out in earlier reports, is that the Hollywood industry is not currently structured to make the most of today’s market realities,” said Dr. Darnell Hunt, chairman of the center. “The studios, networks, talent agencies, and academies are demographically and culturally out of step with the diverse audiences on which their collective future will increasingly depend.”

The report is the fourth in four years from Hunt. It points out that the nation consisted of nearly 40% minorities in 2015 — the last year examined — and will only become increasingly so in the coming years. It also noted that minorities currently buy 45% of all movie tickets.

“Despite false claims to the contrary, there is no tradeoff in Hollywood today between diversity and profitability,” the report concluded. “Diversity is clearly a plus factor for the bottom line. Nor is there a tradeoff between diversity and quality. Quality storytelling plus rich, diverse performances equals box office and ratings success. Year after year, the evidence supporting this equation continues.”

The report, “2017 Hollywood Diversity Report: Setting the Record Straight,” showed that films and television shows with casts that roughly reflect the nation’s racial and ethnic diversity posted the highest box office and ratings numbers on average.

“The sociologist in me knows that minorities over-index in terms of movies and TV,” Hunt said. “People want to see their own stories so the return on investment is strong.”

He pointed to the success of historical drama “Hidden Figures,” which has grossed $144 million at the domestic box office on a budget of $25 million.

The report also showed people of color and women both remained significantly under-represented in 2015.

“People of color have posted gains relative to their white counterparts in five of the industry employment arenas examined (film leads, broadcast scripted leads, broadcast reality and other leads, digital scripted leads, and broadcast scripted show creators), lost ground in four of the 11 arenas (film directors, film writers, cable scripted leads, and digital scripted creators) and held their ground in the other two (cable scripted creators and cable reality),” the report said.

The UCLA report also showed that, relative to their male counterparts, women posted gains in all Hollywood employment arenas since last year’s report except in broadcast reality and cable reality.

The report is being issued five days before the 89th Academy Awards — and a year after the 88th Academy Awards generated widespread complaints that people of color were overlooked in the major acting and directing categories in the nominations. Hunt told Variety he was pleased that minority actors received recognition this year, particularly given how under-represented they were in the report year of 2015.

“The film statistics in the report are rather disappointing, although there was some awards recognition this year,” he added. “But we were not expecting to see a rise in 2015 numbers before we started crunching them.”

The Oscar nominees in the acting categories this year include Denzel Washington for best actor, Ruth Negga for best actress, Mahershala Ali and Dev Patel for best supporting actor and Viola Davis, Naomie Harris and Octavia Spencer for best supporting actress.

The report laid the blame for the lack of progress on the three major talent agencies (CAA, WME and UTA) and on the top executives at studios and networks. It also said access initiatives are useful interventions but no panacea for Hollywood’s diversity problems.

“In the final analysis, it’s not about the availability of diverse talent,” Hunt wrote in the report’s conclusion. “There’s more than enough of that to go around. It’s more about the failure of Hollywood organizations, at their own peril, to find ways to include this talent beyond just the margins. Hollywood’s diversity problems begin at the very top of the studios and networks, in the executive suites, where decisions are made about what gets made and with what size production and marketing budgets.”

Hunt said individuals in these decision-making positions are typically white men who are not motivated to share their power with diverse women and men “whose reservoirs of experience equip them with the perspectives necessary to connect more effectively with today’s audiences.”

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