(The Epoch Times)—Low incentives and complicated state regulations, combined with high housing and business costs, have rendered California unable to keep Hollywood from moving production to other states and countries, according to an entertainment industry report released on May 27 by the Milken Institute, a California-based think tank.
Hollywood’s in-state production has dropped in the past two years as other states and international destinations continue to increase industry incentives, according to the report’s authors, Kevin Klowden, executive director for the Milken Institute Finance, and Madeleine Waddoups, a graduate teaching assistant in the Luskin School of Public Affairs at the University of California–Los Angeles.
The industry has contributed for more than a century to the state’s cultural and physical exports, has a huge impact on tourism, and has also boosted the fields of design, technology, and innovative manufacturing, according to the report, adding that numerous other industries depend on the movie and television business and its contribution to the state’s identity, jobs, and exports.
The industry has seen many highs and lows in California over the past 100 years or more, but has never faced the “wide ranging” threat now posed to production after television reached its peak in 2021, the authors said.
“The consequences for California have been significant,” the institute said.
The Golden State lost $4.14 billion in industry output and more than 17,200 jobs from 2019 to 2023.
“While most states other than New York cannot compete with California’s combination of skilled workers and filming infrastructure, California’s base 20 percent incentives, combined with dramatically higher housing and business costs, have left the state uncompetitive,” the institute found.
A “base 20 percent incentive” means the tax credit in California starts at 20 percent of a film producer’s in-state spending, up to a specified amount.
Previous disruptions to the entertainment industry in California have involved the advent of television in the late 1940s, a strong dollar in the 1990s, and competitive film incentives in the early 2010s, the report said.
But Hollywood has never faced several issues at the same time, as it has recently, according to the institute.
“Combined with high levels of financial strain facing the studios in the wake of the 2023 strikes, driven by stagnating streaming growth and the loss of prior revenue streams in DVDs and broadcast television, the need to find less expensive locations has never been stronger,” the institute reported.
The consequent impact on the state’s workers and businesses—inside the industry and supporting it—“has never been felt more quickly and more severely,” according to the study.
Streaming growth has slowed nationally. From 2019 to 2023, revenue from streaming content increased by 150 percent.
That growth is expected to slow significantly, however.
Pricewaterhouse Coopers, which provides professional services to the global entertainment and media industry, projects only 30 percent growth in streaming revenue from 2023 to 2028, according to the Milken Institute.
The report authors don’t see that as “enough to offset the decline in revenue and demand from movies, broadcast, television, and cable,” they wrote in the executive summary.
National entertainment jobs also decreased by nearly 14 percent from 2019 to 2023. The number of productions peaked around 2016, the institute reported.
From the spring of 2019 to the spring of 2024, entertainment jobs dropped by 15 percent in California, the institute reported. Adding to the pain, working hours and wages in California’s entertainment industry did not bounce back after the 2023 writers and actors strikes during the union-driven national “summer of strikes.”
The five-month writers strike was declared over in September 2023 after they reached an agreement with major studios that included significant multi-year pay raises, more health insurance contributions, regulations on the use of artificial intelligence (AI), and other production guarantees.
The actors settled their contract with studios two months later. Their $1 billion contract also includes pay increases, AI regulations, and the introduction of streaming participation bonuses.
According to the Milken study, workers in the entertainment industry worked an average of 28.5 weekly hours and earned an average of $30.84 per hour in 2023. In 2024, from January to November, that number dropped to 27.3 average weekly hours and $27.38 in average hourly earnings.
“The problem is particularly noteworthy in filming activity within Los Angeles County,” the institute reported.
Since 2019, the number of on-location filming days has dropped by nearly 36 percent in Los Angeles, and soundstage filming days dropped by nearly 30 percent, according to FilmLA, a film office for the city and county of Los Angeles and other local jurisdictions.
Outside competition has strengthened since 2014. Other states are increasing incentives to attract productions. New York has grown its annual incentives funding from 2022 to 2025, raising the budget to $700 million per year and increasing the base credit rate to 30 percent.
Texas is also expected to increase its biannual incentives to nearly $500 million per year by the end of 2025, according to the report.
California allocates $330 million.
The Milken Institute recommended several actions to address the lack of work before the loss of talented workers, prop houses, costume shops, catering firms, camera rentals, and other businesses “becomes irrecoverable.”
The institute recommended increasing the state’s film incentive rates to a base of 30 percent and offering at least $700 million in production incentives per year. The changes would generate nearly $3 billion in additional entertainment spending in California and nearly $6 billion in total output to the state’s economy, according to the report.
Another idea was to address gaps in productions, include shorter-form shows of less than 40 minutes, and increase coverage for independent films and mid-budget productions that provide consistent streams of regular local work.
The institute also suggested moving to a year-round schedule for allocating tax incentives and improving the state’s regulatory processes for applying for the credits.
The report also mentioned streamlining and improving local filmmaking permits and easing restrictions on the use of local buildings.
Local, state, and federal officials have responded to the entertainment industry crisis in California in the past few months.
In May, Los Angeles Mayor Karen Bass issued an executive directive to support local production and boost jobs. The order aims to lower costs, streamline city processes, and increase access to iconic city locations.
In October 2024, Gov. Gavin Newsom proposed a plan to expand the tax credit program for the film and television industry to $750 million—more than double the current $330 million allocation.
And President Donald Trump also announced on May 4 that he authorized his administration to impose a 100 percent tariff on movies produced outside the United States as a way to protect the industry.
Bypass Big Tech Censors
Two Storms, One Harvest
Every food crisis in living memory has been a one-shock event. The 2008 price spike was a commodity bubble. The 2020 shortages were a logistics failure. The 2022 grain scare was a war on one exporter’s ports. Each time, the system bent, adjusted, and recovered, and each time the experts assured us afterward that global markets are simply too big and too diversified to fail.
What nobody in Washington seems eager to discuss is that 2026 is shaping up to be something the modern food system has never actually faced. Two independent shocks, one climatic and one geopolitical, are converging on the same harvest cycle at the same time. Not sequentially. Simultaneously.
Start with the weather. The Pacific Ocean is currently building toward what forecasters now openly call a record event. NOAA’s Climate Prediction Center puts the odds of at least a strong El Niño near 88 percent, with roughly two in three odds it reaches “very strong” status, the tier reserved for perhaps three or four events in the entire satellite era. Every major global model now projects a median peak in Super El Niño territory, and most of them project it exceeding the 2015-16 event, which until now held the modern record. Sea surface anomalies were already brushing the super threshold in mid-July, months before these events normally peak. The atmosphere has already shifted into El Niño mode, and the event is forecast to crest in late fall and early winter.
This is not about “climate change.” It’s about the standard cycles of weather, and the cycle we’re currently in is one that has likely devastated societies in the past. We’re better prepared as a society today, but not all Americans are equally prepared.
Serious households have started doing the quiet math on their own. Grocery bills tell part of the story, and the forecast maps tell the rest, which is why long-term food storage has moved from fringe hobby to mainstream line item in the family budget, with established suppliers like Heaven’s Harvest seeing demand from people who five years ago would have rolled their eyes at the idea. That instinct is not paranoia. It is pattern recognition, and the pattern is worth walking through carefully.
Editor’s Note: Heaven’s Harvest IS a sponsor, but the warnings of this article are real and would be written even if we didn’t have a survival food sponsor. With that said, those who take advantage of what they offer can use promo code “Patriot” for 15% off.
The Fertilizer Clock Is Already Running
While the Pacific warms, the second shock has been unfolding in the Strait of Hormuz. The conflict with Iran turned the world’s most important energy chokepoint into a contested waterway, and the consequences reach far beyond the gas pump. Roughly a third of global fertilizer trade moves through Hormuz, and the disruption sent urea prices up 86 percent year over year by March, with a 53 percent jump in a single month.
The World Bank projects energy prices rising about 24 percent in 2026 and fertilizer about 31 percent. By its own accounting, fertilizer prices ran 35 percent higher in the first five months of this year than the same period last year.
Here is the mechanism the nightly news will not explain. Fertilizer is not a grocery item. It is a time-delayed input. The nitrogen a farmer in Iowa or Punjab could not afford to apply this spring does not show up as a problem this spring. It shows up as a thinner harvest six to twelve months later.
The World Bank’s own food security brief concedes that the effects of reduced applications earlier this season “are likely to become visible only later in harvest outcomes.” Translate that from institutional language into plain English and it means this. The damage is already done, it is already in the ground, and we are simply waiting for it to arrive on the shelf.
Now check the calendar. Six to twelve months from the spring planting season lands us squarely in late 2026 and early 2027. Which is precisely when the strongest El Niño in the instrumental record is forecast to peak, bringing its signature droughts to Southeast Asia, Australia, southern Africa, northern Brazil, and South Asia, the very regions that grow the world’s rice, sugar, and oilseeds.
The World Bank warns openly that a strong El Niño “could disrupt multiple crop belts simultaneously” on top of the conflict-driven input costs. Their baseline projection assumes the Middle East disruptions ease by autumn. What in the last two years of Middle East history suggests that assumption is safe?
The System Has No Slack Left
The comfortable answer is that global markets always adjust. But adjustment requires slack, and the slack is gone. Global cereal production is expected to decline from last year’s records even before El Niño does its work. The UN World Food Programme, hardly a den of right-wing preppers, is calling this the most significant disruption to its supply chains since Covid and the invasion of Ukraine, and its supply chain director put the stakes bluntly.
Today’s supply chain challenges are tomorrow’s hunger crisis.
There is also a political dimension that markets cannot price. When food gets scarce, governments do not behave like economists. They behave like politicians. Export bans, hoarding mandates, and panic buying at the national level turned the modest rice shortfall of 2008 into a global crisis, and analysts are already warning that import-dependent nations are the first dominoes.
The 2015-16 Super El Niño, a far weaker event than what is now forecast, threw tens of millions into food stress across Africa and Asia. This one is projected to be stronger, and it arrives with fertilizer already rationed by price and shipping lanes already contested by missiles.
What Joseph Knew
Scripture does not treat preparation for lean years as faithlessness. It treats it as wisdom delivered in advance to those willing to act on it.
Behold, there come seven years of great plenty throughout all the land of Egypt: And there shall arise after them seven years of famine; and all the plenty shall be forgotten in the land of Egypt.
Joseph did not respond to that warning with a hashtag or a committee. He stored grain during the years of abundance, and when the famine came, Egypt stood while its neighbors begged. The lesson is not that famine is certain. It is that the time to prepare is precisely when preparation still looks optional.
Nobody who filled a pantry in a year of plenty has ever regretted it, and nobody standing in an empty aisle has ever been glad he waited for certainty.
None of this calls for panic, and panic is the enemy of sound judgment anyway. It calls for the same unglamorous prudence our grandparents considered ordinary. Keep some cash margin, know your local growers, and put real food in deep storage while it is cheap and available, because the entire arc of this story is that cheap and available is a closing window.
Families looking for a straightforward place to start can visit Heaven’s Harvest and use promo code Patriot for 15 percent off long-term storable food. The forecasts may yet soften, the strait may yet reopen, and we should pray they do. But hope is a fine thing to hold and a foolish thing to eat.