A Shift in Production Levels
Los Angeles has long been considered the center of film and television production. For decades, the city’s studios, soundstages, and neighborhoods provided the backdrop for countless productions. Yet new data shows that production levels have fallen significantly. According to FilmLA, on‑location filming in Los Angeles dropped by 13.2 percent in the third quarter of 2025 compared with the same period in 2024.
The decline is not limited to one category. Television, commercials, and streaming projects all saw reductions in shoot days. Only feature films showed a slight increase, but not enough to offset the overall downturn. This marks another step in a multi‑year trend, as production has steadily decreased since the record highs of 2021.
Industry observers point to several causes. Higher labor costs, oversubscription to California’s tax credit program, and the appeal of subsidies offered by other states and countries have all contributed. The dual writers’ and actors’ strikes of 2023 also accelerated the shift, pushing productions to explore alternatives outside Los Angeles.
Economic Consequences for Small Businesses
The decline in production has ripple effects across California’s economy. Film and television projects support not only actors and crew but also a wide network of small businesses. Caterers, equipment rental companies, costume suppliers, and local restaurants all benefit when productions are active.
When shoot days fall, these businesses feel the impact immediately. The MSN report on FilmLA’s findings noted that the third quarter of 2025 recorded only 4,380 shoot days, down from 5,048 the year before. That reduction translates into fewer contracts, less spending in local communities, and reduced income for freelance workers.
For small businesses, the unpredictability of production schedules creates additional challenges. Many rely on steady work from the entertainment industry to balance their budgets. When projects relocate to other states or countries, the loss of revenue can be difficult to replace.
Cultural Shifts in California’s Creative Identity
The decline in production also raises questions about California’s cultural identity. For generations, Los Angeles has been synonymous with Hollywood, shaping not only the state’s economy but also its global image. A reduction in filming challenges that association and opens the door for other regions to claim a larger share of cultural influence.
As Deadline reported, the downturn is part of a broader shift in the entertainment industry. Streaming platforms, international co‑productions, and digital technologies have made it easier for content to be created outside traditional hubs. Cities like Atlanta, Toronto, and London have become competitive centers for production, offering both financial incentives and modern infrastructure.
For California, this means that its creative scene may diversify. While large‑scale productions may move elsewhere, independent filmmakers, digital creators, and niche studios continue to thrive. These groups often rely less on major tax incentives and more on local talent and innovation.
The Role of Tax Incentives
California has responded to the decline by expanding its tax credit program. In 2025, the state approved AB 1138, which increased funding for film and television incentives. The program now offers $750 million in credits, designed to keep productions in the state and attract new projects.
According to 4 Filming, officials remain optimistic that the expanded program will help reverse the trend. While the effects are not immediate, FilmLA has already noted early signs of incentive‑backed projects beginning to take shape.
Tax incentives are not a guaranteed solution, however. Other states, such as Georgia and New Mexico, continue to offer competitive packages, and international locations often provide lower labor costs. California’s challenge is to balance financial support with the high cost of operating in Los Angeles.
Opportunities for Independent Creators
While large productions may be leaving, opportunities remain for independent creators. Advances in digital technology have lowered the barriers to entry for filmmaking. High‑quality cameras, editing software, and distribution platforms are more accessible than ever.
Independent filmmakers in Los Angeles are using this moment to carve out space for new voices. Local festivals, streaming platforms, and community organizations provide outlets for projects that might not rely on traditional studio backing. This shift could lead to a more diverse and experimental creative scene, even as large‑scale productions decline.
The downturn also encourages collaboration across disciplines. Musicians, visual artists, and digital creators are increasingly working together, blending mediums to create innovative projects. This cross‑pollination reflects California’s broader creative spirit, which has always thrived on reinvention.
Outlook for California’s Creative Scene
The decline in Los Angeles film production is significant, but it does not signal the end of California’s creative influence. Instead, it represents a period of adjustment. Large productions may continue to explore other locations, but California retains its deep pool of talent, infrastructure, and cultural capital.
The state’s expanded tax incentives, combined with its reputation as a hub for creativity, suggest that production levels may stabilize in the coming years. At the same time, independent creators and smaller studios are likely to play a larger role in shaping the state’s cultural identity.
For audiences and communities, the message is one of resilience. California’s creative scene is adapting to new realities, finding ways to sustain its influence while embracing change. The decline in traditional production may be challenging, but it also opens the door to new forms of artistic expression and innovation.
