Toll from walkout spreads, group says
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The WGA strike will cost the regional economy $220 million in damage each month it continues, a regional economic group projected Wednesday.
The Los Angeles County Economic Development Corp. forecast was 10% higher than the group's previous projection of just a month ago (HR 11/21). To date, the seven-week strike has cost the regional economy $342.7 million in lost wages and ripple effects on such businesses as restaurants, hotels and personal-service firms, the LAEDC said.
"There have been 52 scripted series where almost all production has ground to a halt, and you have motion picture projects starting to founder, so there is definitely an impact out there," LAEDC chief economist Jack Kyser said. "We are seeing wage losses for members of the WGA, and this is spreading through the broader economy. It's going to be painful, and it's going to get more painful as it goes."
Kyser was among those testifying Wednesday before a Los Angeles City Council committee about how the seven-week WGA strike is affecting local residents and businesses.
"It's not going to kill the economy, but it's not going to help," Kyser told The Hollywood Reporter.
Entertainment represents the region's third-biggest economic sector, after international trade and tourism. The industry employs more than 254,000 locally, or 5.5% of the local work force, according to LAEDC statistics.
Some projections of economic impact from the strike have been much lower than those from the LAEDC, but Kyser told councilmen that best available estimates show WGA members already have lost more than $122 million in wages while craft professionals and blue-collar workers who are members of IATSE have lost $211 million.
The Alliance of Motion Picture & Television Producers was the source for both wage estimates, but the LAEDC used an impact multiplier to calculate broader economic impact. The group also noted that the annual Academy Awards represents $130 million in contributions to the regional economy, with the awards program now roiled by the prospect of WGA pickets at the Feb. 24 Oscars.
The MPAA also presented testimony into the record of the Council session.
"Each day the strike continues, more people and more businesses are impacted -- more layoffs and more lost revenue," MPAA senior vp Vans Stevenson said. "We know restaurants, florists and dry cleaners are affected because their customers have to cut their spending, (and) also of concern is the loss of health insurance coverage to entertainment union and guild employees."
AMPTP spokesman Jesse Hiestand said the studio group deferred to the MPAA for the council testimony, as that's the group that normally represents studio interests before governmental bodies.
WGA negotiating committee chair John Bowman testified on the guild's strike and its stalled negotiations with the AMPTP. Afterwards, the guild criticized the AMPTP for not adding its own testimony to the proceedings.
"The (AMPTP) was invited to attend but refused," the WGA said. "We believe their refusal shows a callous disregard for the people of Los Angeles. First these companies walked away from the bargaining table, and today they chose to ignore the economic hardship their actions have caused. The WGA would like to solve this problem and get everyone back to work, but that can't be done until the other side comes back to the table."
The WGA strike today marks its 46th day, with no new bargaining sessions with the AMPTP planned and the guild setting its sights on more limited work agreements with individual production companies.
After the Council session, Bowman again told reporters he hopes to announce deals with some number of independent companies by next week. One such pact is expected to be hammered out with David Letterman's Worldwide Pants.