Study eases strike cost
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A UCLA economist said an oft-quoted projection of the regional economic threat from a long writers strike is greatly exaggerated.
Jerry Nickelsburg, an economist with the university's Anderson School of Management, said Wednesday that his recently concluded analysis shows a strike of five months or longer would hit the Southern California region with perhaps $300 million in economic damage. That compares with a figure of $1 billion recently crunched by the Los Angeles County Economic Development Corp.
LAEDC chief economist Jack Kyser said that the region would take a $200 million monthly hit beginning in January if the WGA strike were not settled by then. Kyser based the projection in part on the $500 million in economic damage that was estimated after the 22-week WGA strike in 1988.
Entertainment represents a bigger part of the regional economic pie than it did 19 years ago, Kyser said, and inflation alone would suggest a higher figure than in '88.
But Nickelsburg said the region actually is less vulnerable to fallout from an entertainment strike now than in the last WGA walkout.
"The entertainment industry and in particular television entertainment is quite different than it was in 1988," the UCLA economist wrote. "One cannot simply take the lost wages from the 1988 strike and extrapolate them to today.
"In 1988, there were very few reality or unscripted television shows," he said. "Unscripted shows do not require WGA writers and continue to be produced through the strike period. (So) extrapolating from the wages not paid during the 1988 strike to today's industry ignores the shrinking importance of scripted television and overstates the impact of the strike."