Why aren't filmmakers shooting in LA?

Summary

The Indicator from Planet Money: Why Aren't Filmmakers Shooting in LA?

Release Date: July 15, 2025

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Introduction

In the July 15, 2025, episode of The Indicator from Planet Money, hosts Darian Woods and Waylon Wong delve into the shifting landscape of the movie industry, exploring why Los Angeles, traditionally the heart of filmmaking in the United States, is seeing a decline in local productions. The episode titled "Why Aren't Filmmakers Shooting in LA?" examines the economic incentives driving filmmakers to seek locations outside of Hollywood and the broader implications for the city's film industry.

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Filmmakers Leaving LA: The New Trend

The episode opens with a spotlight on filmmaker Aaron Moorhead, whose career trajectory illustrates the broader trend of filmmakers basing themselves in Los Angeles but choosing to shoot their projects elsewhere.

Waylon Wong introduces Moorhead:

"The first movie Aaron Moore had ever saw in theaters was Jurassic Park." (00:12)

Moorhead reflects on his early experiences and eventual move to LA, where he collaborates on independent horror and sci-fi films. However, despite being rooted in LA, Moorhead often shoots his movies in locations like southeast Italy and New Orleans to benefit from local incentives.

Darian Woods highlights two of Moorhead's projects:

"Take his 2014 film Spring, about a traveler who gets involved with a woman who turns out to be a mutant. That movie was shot in southeast Italy." (00:31)

"Or take Aaron's 2019 movie Synchronic. This one is about two paramedics investigating a new drug that that alters people's perception of time. It was shot in New Orleans." (00:51)

These choices are influenced not only by narrative needs but significantly by economic incentives offered by these locations.

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The Rise of Film Tax Incentives

The conversation shifts to the proliferation of film tax incentives across various states and countries.

Patrick Button, an economist at Tulane University specializing in film tax incentives, provides historical context:

"In the early 2000s, state governments started vying for a piece of that Hollywood economic sparkle, and they did this by offering subsidies for film and TV production." (03:03)

Initially adopted by states like Louisiana and New Mexico in the 1990s, the number of states offering such incentives surged from fewer than ten to nearly forty between 2005 and 2010.

Waylon Wong explains how these incentives function:

"Production companies recoup a certain percentage of the money they spend locally. That could be for hiring workers, renting equipment, or paying for a hotel." (04:10)

Filmmakers benefit through rebate checks, tax credits, or by selling excess credits to other businesses. These rebates can cover 20% to 35% of local expenses, making a substantial difference in the feasibility of projects.

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Economic Impact and Challenges

While the incentives appear beneficial for attracting productions, their effectiveness in stimulating local economies is debated.

Patrick Button observes:

"People used to talk about New Orleans being the Hollywood of the south, and, you know, we don't see as much of an impact on the local film industry as you might think would be the case." (05:02)

The influx of productions to other states and countries has led to a gradual siphoning of projects away from California. Internationally, countries like Canada, the UK, Hungary, Thailand, and New Zealand offer competitive incentives, with New Zealand providing up to 40% back on local spending.

Jason Blum, founder of Blumhouse and producer of the Purge series, shares his experience:

"It was a creep. The first one was like, we're gonna save two or three million dollars. So I was like, well, that one we should go out of state. But I didn't think that the next 10 would then be out of state." (05:34)

The dwindling number of local productions has tangible effects on Hollywood's infrastructure. Blum notes the underutilization of studio lots equipped with extensive resources:

"Emotionally, it's kind of sad, but it also seems so wasteful." (06:40)

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California's Response: Expanding Incentives

In response to the declining local productions, California has sought to enhance its own incentive programs. Recent legislative changes include a significant budget increase and a boost in tax credits:

"Last month, Gavin Newsom signed a new budget that expands California's incentive program. It will now award $750 million a year, up from $330 million in previous years. This month, lawmakers also bumped up the tax credit from 20% to 35%." (08:29)

Economist Patrick Button acknowledges that California's deep-rooted agglomeration economy—where businesses cluster to benefit from shared resources and networks—gives it a unique advantage:

"California's incentive program did increase the probability of filming within the state budgets and hiring also went up for non-independent productions." (08:06)

However, Button raises concerns about the cost-effectiveness of these incentives:

"Is this a good use of taxpayer dollars relative to other uses of that money?" (08:29)

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Future Prospects and Industry Sentiment

Despite enhanced incentives, challenges persist in retaining filmmakers within Los Angeles. Delays in the application process and the high cost of production in LA continue to push filmmakers to seek more immediate and generous incentives elsewhere.

Jason Blum emphasizes the need for more streamlined and substantial incentives:

"People are willing to make a little less money if they can live at home. What it's not worth is paying twice as much or a third as much more, which is what is the case right now." (07:52)

Filmmaker Aaron Moorhead expresses hope for the future:

"I want to see a lot of young filmmakers out there shooting their little micro budgets in indies and stuff like that and I want them not having to break their bank account just to just to show up. Yes, I want the big business to thrive, but I also want its youthful energy to come back in terms of like it, feeling like the place where you build your dream, you know?" (09:30)

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Conclusion

The episode concludes by acknowledging the ongoing struggle of Los Angeles to maintain its status as the epicenter of the film industry amidst growing competition from other states and countries offering lucrative incentives. While California has taken steps to bolster its own programs, the effectiveness of these measures in reversing the trend remains to be seen. Filmmakers like Aaron Moorhead and industry leaders like Jason Blum highlight the importance of both economic support and the preservation of LA's unique creative environment to sustain its pivotal role in global filmmaking.

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Looking Ahead

Tomorrow's episode will shift focus to China and its pursuit of Hollywood-style cinema ambitions, further exploring the global dynamics of the film industry.

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Produced by Angel Carreras | Engineered by Jimmy Keeley | Fact-Checked by Tyler Jones | Edited by Kicking Cannon | The Indicator is a production of NPR.

Transcript

[NPR Host]

NPR.

[Waylon Wong]

The first movie Aaron Moore had ever saw in theaters was Jurassic Park.

[Aaron Moorhead]

I think it was Rated not for 5 year olds, but my parents let me see it.

[Waylon Wong]

Aaron ended up going to film school and then he moved to Los Angeles. He and a couple of collaborators started making independent horror and sci fi movies together.

[Darian Woods]

There's a little plot twist in Aaron's career journey, though. He's based in LA, but he shot his movies elsewhere. Take his 2014 film Spring, about a traveler who gets involved with a woman who turns out to be a mutant. That movie was shot in southeast Italy.

[NPR Host]

And they found her dead body in Sicily.

[Darian Woods]

Or take Aaron's 2019 movie Synchronic. This one is about two paramedics investigating a new drug that that alters people's perception of time. It was shot in New Orleans.

[NPR Host]

We pulled over so much, there's people dying all over New Orleans.

[Waylon Wong]

Both projects had story reasons to shoot where they did, but just as important were the economic reasons. Airing got incentives from Italy and New Orleans, and this kind of story has been playing out across the industry. Film and TV production has shifted from Hollywood to other states and countries.

[Darian Woods]

This is the indicator from Planet Money. Darren I'm Darian Woods.

[Waylon Wong]

And I'm Waylon Wong. We are doing a special series this week about the movie business. On today's show, is Hollywood still the epicenter of film production? We look at the shifting economics of moviemaking and how the industry is trying to revive la.

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[Darian Woods]

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[NPR Host]

Think one of the very important roles.

[Jason Blum]

We have here as a fiduciary is.

[Waylon Wong]

To help expand people's thinking about what.

[Darian Woods]

This money is needed to do for them.

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[Darian Woods]

Eduardo in yesterday's episode we talked about how Hollywood is an example of an agglomeration economy. That's when businesses in the Same industry or complementary industries set up shop in the same geographic area. Ideally, this clustering leads to lower costs and greater productivity.

[Waylon Wong]

Patrick Button is an economist at Tulane University who wrote their dissertation on film tax incentives. Patrick says that in the early 2000s, state governments started vying for a piece of that Hollywood economic sparkle, and they did this by offering subsidies for film and TV production.

[Patrick Button]

The idea is that this could bolster the local film industry and it could sort of create jobs. But there's a lot of motivations that go behind this. It's all about featuring their city, where they live, and telling their stories, right? So this is really, really tied up with culture and identity. And then there's also some flashy elements of this, too. So maybe you have a film incentive, and then a film comes through that has, like, Angelina Jolie or like Lady Gaga or someone, you know, like, that's a big deal, right?

[Waylon Wong]

Yes, Lady Gaga is a big deal. So you can see how state lawmakers got dollar signs and stars in their eyes.

[Darian Woods]

Patrick says a couple of early adopters like Louisiana and New Mexico jumped in during the 90s. Then the number of states offering film incentives exploded between 2005 and 2010 went from fewer than 10 states to nearly 40.

[Waylon Wong]

And here's how these incentive programs tend to work. Production companies recoup a certain percentage of the money they spend local. That could be for hiring workers, renting equipment, or paying for a hotel.

[Darian Woods]

The filmmakers get this money back in a few different ways. It could be a rebate check. It could be a credit towards local taxes. If the credit is more than what the production company owes in local taxes, it can sell that credit to another business. Patrick says there's a whole market for buying and selling these tax credits.

[Waylon Wong]

Ultimately, these rebates can be 20 to 35% of local expenses. For some filmmakers, those subsidies can make the difference between whether a project happens or not. But the upside for local governments is murkier. Economic research by Patrick and others show that these film incentives haven't been that effective in creating new jobs or businesses.

[Patrick Button]

People used to talk about New Orleans being the Hollywood of the south, and, you know, we don't see as much of an impact on the local film industry as you, you might think would be the case.

[Darian Woods]

What these programs have done is slowly draw production away from California. And it's not just US States. In Canada, both the federal and many provincial governments subsidize film production. The uk, Hungary, Thailand, they all have programs. New Zealand, my home country, offers up to 40% back on local spending. We are obsessed with our movie industry in New Zealand, clearly.

[Waylon Wong]

Well, you know, this global race to capture film production unfolded so gradually that it was hard to notice at first. That's according to Jason Blum. He's the founder of Blumhouse, which is the company behind horror hits like Get.

[Capital One Representative]

Out, Good to see you, and I'm.

[Aaron Moorhead]

A brother around here.

[Darian Woods]

Ah, yes, of course.

[Waylon Wong]

And the Purge series.

[Darian Woods]

Help me, someone please help me.

[Jason Blum]

It was a creep. The first one was like, we're gonna save two or three million dollars. So I was like, well, that one we should go out of state. But I didn't think that the next 10 would then be out of state. You know what I mean?

[Darian Woods]

Data from an LA nonprofit shows that 2024 was the second lousiest year ever for local filming. Only 2020 was worse. Hollywood has suffered a number of recent setbacks, from the COVID shutdowns to labor strikes to the devastating wildfires in January. Jason can feel how quiet it's gotten when he visits studio lots in town.

[Jason Blum]

These are big with many, many stages. And you see, like, you know, three game shows and very little scripted movies or shows shooting on these stages. And there's so many resources on these lots. There's a wood shop, there's a costumer, there's a prop house. Like, I need a typewriter from 1952. You know, here it is. The infrastructure is better in Hollywood than anywhere else in the world by a lot. So emotionally, it's kind of sad, but it also seems so wasteful.

[Waylon Wong]

California has tried to compete with its own incentive program. Jason's company got a tax credit from the state for the Purge, too. That was back in 2013. He says he usually doesn't even bother to apply. That's because he typically doesn't hear back from the state until it's too late in the planning process.

[Darian Woods]

That timeline is something he'd like to see change in California. People in the industry also want a bigger pot of money for film incentives because it's often too pricey to film in la, given the costs of permitting labor and other expenses. A more generous incentive program could make the math work better.

[Jason Blum]

Financiers are willing to spend a little bit more money to stay in California. People are willing to make a little less money if they can live at home. What it's not worth is paying twice as much or a third as much more, which is what is the case right now.

[Waylon Wong]

And economist Patrick Button says unlike other states, California is a place where tax incentives could work. This is thanks to the state's natural advantages as an agglomeration economy. There's one study from 2021 showing that California's incentive program did increase the probability of filming within the state budgets and hiring also went up for non independent productions.

[Patrick Button]

So then the question comes, you know, is this a good use of taxpayer dollars relative to other uses of that money? Right.

[Darian Woods]

This debate took center stage when the state hammered out its new budget. Last month, Gavin Newsom signed a new budget that expands California's incentive program. It will now award $750 million a year, up from $330 million in previous years. This month, lawmakers also bumped up the tax credit from 20% to 35%.

[Waylon Wong]

On the federal level, President Trump has talked about putting tariffs on foreign movies as a way to bolster American film production, but it's unclear how this would work.

[Darian Woods]

What is real for people like Aaron Moorhead, the filmmaker we heard from earlier, is their connection to la. He plans to keep living in the city and he hopes there is still a pathway for Hollywood hopefuls to build a career like he did. He started out making indie horror films and today he's a director for Daredevil, the Netflix superhero series.

[Aaron Moorhead]

What I want to see is a lot of young filmmakers out there shooting their little micro budgets in indies and stuff like that and I want them not having to break their bank account just to just to show up. Yes, I want the big business to thrive, but I also want its youthful energy to come back in terms of like it, feeling like the place where you build your dream, you know?

[Waylon Wong]

Tomorrow on the Indicator we'll shift our focus to China and how that country has been pursuing its own Hollywood style dreams. This episode was produced by Angel Carreras and engineered by Jimmy Keeley. It was fact checked by Tyler Jones. Kicking Cannon is our show's editor and the Indicator is a production of npr.

[NPR Host]

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