In recent years, film and television production as well as advertising projects in Hollywood, USA, have been continuously moving to other states or countries such as Canada, the UK, among others. The high labor costs in California, strict environmental regulations, and endless labor union negotiations have severely undermined Hollywood’s traditional advantages.
According to an analysis report published on Sunday (August 16) by Politico, data shows that in the past decade, the proportion of movies produced locally in Hollywood has been continuously decreasing, while the number of American films shot in Georgia, the UK, and Canada has been steadily increasing.
The most eye-catching change is that none of the ten films nominated for Best Picture at the 2024 Oscars were filmed in Los Angeles.
In late July, the FilmLA office in Los Angeles released data showing that on-location production in the Los Angeles area had decreased by 12.7% compared to the same period the previous year.
Meanwhile, in just the first week of July, over 25 film and advertising projects were shifted to Illinois for filming or pre-production.
The non-profit organization Bring Hollywood Home Foundation announced at a press conference in May that in 2006, there were 52,000 production days in the Los Angeles area, but by 2025, this number had plummeted to only 19,694 days, a shocking decline.
Previously, the flourishing of the Hollywood film industry provided a large number of middle-class jobs in the area, but between 2022 and 2024, Los Angeles County alone lost over 42,000 film-related job opportunities.
Congresswoman Laura Friedman expressed concerns about the continuous shrinkage of the industry, worrying that the disappearing middle-class job opportunities that Los Angeles relies on are vanishing.
In addition to the high labor costs and strict environmental regulations in California, the powerful labor unions are also considered to be one of the main factors stifling Hollywood.
In 2023, following a major strike by the Writers Guild, the Screen Actors Guild-American Federation of Television and Radio Artists (SAG-AFTRA) initiated another major strike, demanding higher wages and more benefits, leading to many film and television projects being forced to halt or postpone production.
Facing the risk of consecutive strikes in Hollywood, many production companies have opted to move to Canada, the UK, and other countries. The continuous strikes have led to a loss of job opportunities in Hollywood, forcing many professionals to seek alternative paths.
The actors’ union had initially anticipated a rebound in industry activities after the strikes ended, but the actual aftermath has been a continued decline.
Just when Hollywood was starting to show signs of recovery, the disaster of the Southern California wildfires in January 2025, directly hitting the outskirts of Los Angeles, heightened producers’ awareness of risks and accelerated their departure from Los Angeles.
Many Hollywood producers, when selecting filming locations, did not even consider Hollywood as an option. A survey found that among film projects scheduled to begin filming within two years, California was only ranked sixth as a filming location, falling behind Toronto in Canada, the UK, Vancouver in Canada, Central Europe, and Australia.
In recent years, cities like Chicago, Illinois, as well as several countries overseas such as Canada and the UK, have been competing for Hollywood film, television, and advertising projects through tax breaks and other incentive policies.
According to public records in the industry, as of May 2026, there have been 120 film production incentive programs introduced by governments in other countries, as well as states outside of California in the United States.
One of the earliest regions to benefit from the decline of Hollywood was Vancouver and Toronto in Canada. Since the 1990s, these two cities have been vying for the title of “Hollywood North,” relying on lower costs – partly due to favorable exchange rates – and cityscapes authentic enough to pass as American locations.
Furthermore, the emergence of new technologies such as cost-effective digital filmmaking systems has reduced the reliance on film printing, making it easier to shoot films and TV shows in locations far from California’s vast production ecosystem.
The increasing competition among the provinces in Canada for incentive measures has made Canada more attractive for American production projects, prompting various states in the US to introduce similar incentive programs.
According to Peter Hawley, Deputy Director of the Illinois Film Office, the state issued $210 million in incentive funds in 2025, leading to $703 million in production expenditures and currently ranking sixth among film and television production locations in the United States.
Illinois Governor J.B. Pritzker stated that the state had increased the base tax credit from 30% to 35% last year, with the additional incentives of green production and the relocation of out-of-state productions, allowing up to 50% in tax credits, a program that has been extended until 2038.
The well-known Chicago fire-themed series “Chicago Fire” produced by Dick Wolf since 2012 is filmed in Chicago, which has significantly boosted Illinois’s industry.
Shortly thereafter, the spin-offs “Chicago P.D.” and “Chicago Med” were introduced. All three series are filmed at Cinespace Studios in Chicago.
Located in an old steel factory in a working-class community in the west side of Chicago, the studio has a large space and has helped establish a stable base for television production in the area.
Illinois officials have taken Georgia as a cautionary example. Since 2005, the state has implemented an unlimited tax credit program, earning the title of “Hollywood of the South,” but production expenditures have fallen from $4.4 billion in the 2022 fiscal year to $2.3 billion in the 2025 fiscal year, highlighting structural issues such as an overly high percentage of out-of-state workers.
Pritzker stated that simply attracting projects with money is not enough; if local workers and the economy do not truly benefit, incentive policies lose their meaning.
The Illinois Film Office recently introduced the first “Green Production Certification” in the United States, providing an additional 5% tax credit for production projects that have already enjoyed the state’s film production tax credit program.
This certification requires the production crew to reduce waste, including recycling, composting food waste, energy-efficient lighting setups, and reducing the use of diesel generators, among others.
A recent case benefiting from this certification was a Walgreens advertising film crew shot in the suburbs of Chicago last month. Ellen White, head of the sustainable development consulting firm EcoFixr, supervised the production team throughout to ensure the implementation of relevant measures for the “Green Production Certification.”
Kylie Ruehl, Managing Director of TPC Productions, pointed out that this green incentive was one of the key factors that led the team to choose Illinois over Georgia for filming.
To address the crisis of Hollywood’s decline, California has also taken rescue measures, striving to curb the “production exodus.”
Legislators in the state expanded the “Film and Television Tax Credit Program” in 2025 to over twice its size, reaching $750 million annually. This measure has led to a slight increase of about 10% in production volume.
According to data from the California Film Commission, in the first 14 months of the expanded incentive program’s implementation, approximately $7.2 billion in direct production spending was generated.
However, industry insiders criticize Governor Gavin Newsom’s new rule proposed this summer to limit corporate tax credits, fearing that it will weaken the actual effectiveness of this incentive and further stifle the industry.
Assemblymember Rick Chavez Zbur warned in late July during a parliamentary speech that Newsom’s new rule would exclude advertising and independent post-production projects from tax credits, which, if not amended, could lead to more jobs flowing out of state.
California legislators are currently pushing for new advertising production and post-production incentive measures, attempting to exclude film production privileges from Newsom’s proposed restrictions on tax credits.