LOS ANGELES, October 5 The bottom line: US film and television production spending has dropped sharply over the past 25 years, according to a new report from major Hollywood unions. By the numbers, studios spent 74% of their film production budgets in the United States a quarter-century ago, but that share has fallen to 42% today. For television, domestic spending dropped from 94% to 64% over the same period, a decline of about one-third.
The report, released on October 6, 2026, by Marina Peña for Yahoo Entertainment and citing the California Post as the content provider, was issued by a coalition including IATSE, the Directors Guild of America, and SAG-AFTRA. These unions represent workers across the American entertainment industry.
Investors will note the timing: the report’s release coincided with the anticipated closure of the Paramount Skydance acquisition of Warner Bros. Discovery, expected to finalize on Tuesday, October 6, 2026, and result in the rebranding of the combined entity as Skydance Corporation. The figure that matters for policymakers is the overlap with congressional consideration of a proposed federal production incentive of 20 to 30% aimed at encouraging domestic film and TV production.
The unions say the decline reflects a long-term trend of production shifting abroad due to tax incentives, lower labor costs, and infrastructure investments overseas, though the report does not attribute the change to any single cause. Looking ahead, industry groups will watch whether federal incentives gain traction and how the newly formed Skydance Corporation approaches domestic production amid ongoing concerns about job opportunities and economic impact on traditional production hubs.
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Background and why it matters
The practice of producing films and television shows in the United States has evolved significantly since the early days of Hollywood. For much of the 20th century, the American film industry was centered in and around Los Angeles, benefiting from established studios, skilled labor pools, and favorable weather for year-round shooting. This concentration helped solidify the U.S. as a global leader in entertainment production, with domestic spending forming the overwhelming majority of industry outlays for decades.
US film and television production spending refers to the portion of total budgets allocated by studios and producers for filming, labor, and related activities conducted within the United States. Over time, this share has been influenced by a range of economic and logistical factors, including the rise of competitive production hubs in other countries offering financial incentives, lower operational costs, and purpose-built facilities.
In recent years, the shift of production work overseas has accelerated, driven by the expansion of tax credit programs in nations such as Canada, the United Kingdom, and various locations in Asia and Europe. These incentives, combined with investments in local infrastructure and workforce development, have made international locations increasingly attractive for both film and television projects, prompting studios to allocate more of their budgets abroad.
This trend matters now because it directly affects employment opportunities for American entertainment workers, from crew members to actors, and impacts the economic vitality of traditional production centers like Los Angeles and New York. As policymakers consider federal incentives to counteract the decline, the balance between domestic and international production remains a key concern for industry stakeholders, labor unions, and communities dependent on the entertainment sector.
