Hollywood is not just going through a rough patch. It’s paying the price for years of arrogance, bad business decisions, and political theater that put ideology and short-term spin ahead of audiences and basic economics. Jobs are disappearing, soundstages are dark, and the entertainment capital that once lectured the rest of the country now struggles to keep work from fleeing to other states and other countries.

The numbers tell the story better than any studio press release. As the Wall Street Journal reports, motion picture and video employment in Los Angeles County fell from about 142,000 jobs in 2022 to roughly 100,000 by the end of 2024, a loss of around 42,000 positions in just two years. Film and TV production in the greater Los Angeles area dropped more than 14 percent in 2024 compared with the prior year, and scripted projects shot in the county fell from 228 in 2022 to only 157 in 2024, giving Los Angeles under one fifth of scripted releases. For an industry that once dominated global production, that slide is not a fluke. It is a verdict.

⚡️LA is collapsing because the lie stopped paying.

For decades, people accepted bad economics because the city sold transcendence. You traded money, stability, dignity, and time for proximity to upside that felt nonlinear and sacred. The system only worked because enough people… https://t.co/QhX1INXEuP

— SightBringer (@_The_Prophet__) December 26, 2025

Behind those statistics are workers who played by Hollywood’s rules and are now left behind. Crew members, animators, and postproduction staff who once counted on steady work now scramble for side jobs or leave the business entirely. Local vendors in Los Angeles that depended on studio orders report plunging sales as fewer shows and films shoot in the city, with some shuttering or moving operations elsewhere. At the same time, Los Angeles County has seen continued population loss since 2020, as residents priced out by housing and squeezed by inflation seek work and stability in other regions.

The root causes stretch beyond the 2023 strikes, though those walkouts did shut down production and delayed projects. Streaming giants that once threw money at every idea now cut spending and trim their slates to chase profits instead of growth at any cost. When the easy money dried up, studios were left with a bloated system, huge overhead in California, and viewers who had grown more selective and more skeptical. Shooting in Los Angeles became harder to justify when places like Georgia, New York, and Canada offered competitive tax credits and lower costs without the same political baggage or regulatory burden.

Hollywood’s cost problem has a long history, and it is not a secret. The practice of “runaway production” goes back decades, as studios chased cheaper labor and friendly tax regimes overseas and out of state. California tried to respond with a film tax credit program that once capped support at about $330 million a year, but while competitors expanded their incentives, Sacramento moved slowly. By the time the state raised the cap to $750 million annually in 2025, more projects had already built relationships and infrastructure in rival hubs. Governor Gavin Newsom now touts the bigger credit as proof that California is “competitive,” even as production data show Los Angeles still losing ground and 2024 on-location filming described as the worst year on record aside from the pandemic.

Critics argue that Newsom treated Hollywood as a political ally first and an industry in crisis second. While he promoted climate rules, new mandates, and an overall regulatory climate that raised costs, productions kept shifting to states and countries that welcomed them without lectures. The new tax credit may slow the bleeding, but it does not change the larger reality of high taxes, expensive housing, and dense regulation that make California a tough place to shoot when cheaper, business-friendly options exist. Hollywood helped create this environment by backing the same politicians who now scramble to lure back business that fled on their watch.

Content itself is another pressure point that polite industry talk often avoids. Viewers have sent a message at the box office and in streaming signups: they do not want to pay for political sermons disguised as entertainment. Far too many high-profile studio projects over the last several years leaned into ideological themes while sidelining basic elements such as coherent plots and relatable characters. And in response to pushback, “woke” Hollywood treated its customers as a problem to fix rather than an audience to serve, and audiences responded by further tuning out, replaying older favorites, or turning to independent creators who focus on story first.

At the same time, the business still remains too focused representation and hiring that’s more ofteh the product of fear rather than creativity on set. When the studios are still chasing internet trends or activists’ approval instead of broader appeal, they give alternative media and smaller studios room to grow. Hollywood once shaped the culture, but now it wonders why middle America is changing the channel.

Artificial intelligence adds another threat that Hollywood helped unleash but did not prepare for. Analysts warn that VFX artists, postproduction workers, and some writers are among the most exposed to the rise of generative AI tools. The 2023 strikes included fierce fights over AI, as unions demanded guardrails to keep studios from replacing people with software or reusing their images and work without proper pay. Even with new contract language, the technology continues to advance, and studios eager to cut budgets have every incentive to automate wherever they can, especially while revenues flatten and debt mounts.

AI could lower costs and speed up production schedules, but that does not help the lighting technician or storyboard artist who just saw a decade of experience devalued by a prompt on a screen. Some experts say new roles could emerge in supervising or guiding AI systems, yet those positions will not cover tens of thousands of losses if studios keep shrinking their slates. Hollywood’s leadership embraced digital tools and cheap digital effects to juice profits in the short term. Now the same logic treats many human workers as optional line items.

While California finally moves to sweeten tax breaks and studios quietly rethink bloated budgets, political voices outside the usual Hollywood orbit see an opportunity. Donald Trump, now back in the White House, has floated ideas such as tariffs on movies filmed abroad to push production back onto American soil. Whether such policies become law or not, the fact that a Republican president can position himself as a potential protector of film workers shows how far the industry’s old political alliances have shifted. Hollywood used to lecture the rest of the country about politics. Now it may need help from politicians it once mocked.

For viewers, the fallout is already visible. There are fewer new scripted shows, more cancellations, and longer gaps between seasons, while ticket prices remain high and streaming fees keep climbing. Independent films and smaller regional productions may fill part of the gap, especially in states that welcome them with sensible incentives and a lower cost of doing business. Hollywood can blame strikes, pandemics, and new technology, but until it faces the role of its own choices in alienating audiences, driving up costs, and backing policies that chased production away, the credits will keep rolling somewhere else.

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