Runaway film, TV productions cost California 36,000 jobs

09:23, July 23, 2010      

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California has lost more than 36,000 jobs and 2.4 billion U.S. dollars in wages over the last decade as production has migrated away, a nonprofit economic think tank said on Thursday.

The Milken Institude said the figures were based on a survey which ran through 2008, the last year for which federal and state labor data were available.

Milken attributes the job losses to the flight of movies and TV shows to other states and countries. In addition to countries such as Canada and Britain, more than 40 states now compete for a piece of the 57-billion-dollar U.S. production industry.

California implemented its own film tax credit program in July 2009, allocating 500 million dollars over five years. The program offers filmmakers up to 25 percent credit on production expenses.

Since the tax-incentive program was implemented, on-location filming has increased in the state, particularly in Los Angeles, according to an earlier report by FilmL.A., an agency that coordinates film permits.

A total of 11,134 permitted production days were tallied during the second quarter of this year in Los Angeles, an increase of 16 percent, compared with 9,597 in the same period last year, said FilmL.A.

But the increase cannot offset the heavy losses experienced by Calfornia, industry sources say.

"There's no doubt that incentives have been drawing jobs and wages away from California," said Kevin Klowden, director of the Milken Institute California Center.

To turn the tide, the Milken report recommends that the state tax incentives be made permanent (they are set to expire in 2014) and expanded to include studio films with budgets greater than 75 million dollars, which are not currently covered.

"While California's incentive package appears to be working, we have a lot of catch up to get back the share of production we had in 1997," Klowden said.



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