Study: Hollywood Jobs Undercounted

Hollywood has a much bigger cast than previously thought, according to a study released Wednesday.

The report by the newly formed, state-funded Entertainment Economy Institute concluded that the number of entertainment jobs in California is about twice the totals estimated by state employment officials. The numbers also are about one-third higher than the most optimistic previous estimates, officials said.

In 2002, the study said, the number of jobs connected to the entertainment industry reached 294,183, with a peak of 325,889 jobs in 1999, when local film and TV activity was at an all-time high.

The study is the most detailed effort to date by officials determined to get their arms around employment in an industry where hard job numbers have long proved to be elusive.

Critics contend that industry employment is undercounted because traditional methods of gathering job statistics don’t account for Hollywood’s unique way of doing business, in which a large workforce moves from project to project.

They also say that jobs involving entertainment work, such as catering, equipment rentals, construction work and payroll services, often are classified in non-entertainment categories.

Critics have long complained that the lack of data makes it harder for policymakers to detail the effect of such problems as runaway film production. A 2001 Commerce Department report on runaway production noted that “our official statistics are woefully deficient.”

Such complaints led to the formal launch of the Entertainment Economy Institute this year. It is funded by a $742,000 workforce grant awarded in 2002 by then-Gov. Gray Davis.

“The goal is to be very clear on what constitutes entertainment industry employment, what is an entertainment firm and, over time, what are the trends,” said Kathleen Milnes, chief executive of the Pacific Palisades-based institute.

Economists also note that more accurate job trends also could help the industry lobby for measures to keep production in the U.S. by underscoring the industry’s blue-collar side.

“People watch ‘Entertainment Tonight’ and ‘Access Hollywood’ and think it’s all champagne and caviar,” said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp. “It doesn’t show you how many people depend on this industry to make a living.”

The study, which evaluated employment information from 1991 to 2002, detailed a large, fluid workforce that ebbed and flowed, depending on the amount spent on production.

The study showed that Hollywood’s job growth of 29% during that period exceeded the 17% growth for private company employment.

Payroll also was higher for the industry, the study found, with annual pay averaging $56,253, compared with $40,769 for private companies overall in 2002. The institute said the number wasn’t skewed by highly paid actors and directors because they were typically compensated via special corporations formed for tax purposes and the payments didn’t appear as salaries.

Highlighting the fragmented, freelance nature of today’s Hollywood, the institute noted that the industry was made up mostly of small firms with fewer than 20 employees and that entertainment jobs were growing in Southern California in areas adjacent to Los Angeles County.