Hollywood Film and TV Production Faces Structural Shifts Amid Decline in LA Dominance
The Hollywood film and television industry is experiencing a significant structural shift as post-pandemic challenges, including prolonged writers’ and actors’ strikes and rapid technological changes, have weakened Los Angeles’ traditional dominance in film and TV production.
Production work is increasingly relocating outside LA to cities such as Atlanta, Toronto, London, and Budapest. Although the series Fallout has moved back to LA, highlighting ongoing trends, this is an exception rather than the rule. Fallout's second season received $25 million in state funding to shoot in LA, and its third season secured $166 million in funding to remain there.
Despite these efforts, broader industry data indicate a downturn in LA. Contributions to motion picture pensions have dropped by about a third over three years. Shooting days in LA declined by over 20% from early 2024 to early 2025, and LA’s share of global production fell from 21.9% in 2022 to 18.3% in 2024.
Ancillary sectors supporting production also show strain: a North Hollywood costume warehouse closed following a fire sale; numerous camera and equipment rental shops have shuttered; and a car rental lot serving the industry reported a drop to six rentals per day compared to 42 previously.
The rise of technology giants such as Netflix and Amazon as major producers and distributors introduces intense competition among streaming services, leading to diminished traditional theatrical runs. There are currently around 120 global production centers.
Economists argue that tax incentives alone may not reverse the downturn. Strengthening intellectual property rights could better enable content creators to retain value. Los Angeles is expected to remain central for marketing, sales, and distribution roles within the industry.
In response, California Governor Gavin Newsom proposed increasing the film and TV tax credit from $330 million to $750 million to encourage productions to stay local. However, concerns remain regarding budget constraints and whether these incentives deliver a positive return on investment.
