California's Economy Takes $5B Hit As Hollywood Walkouts Exceed Projections

The unprecedented double strike by Hollywood has reportedly punched a $5 billion hole in California’s economy, marking the first such walkout in over six decades, Business Insider reported.

The entertainment sector has been largely stagnant after the Writers Guild of America and the actors’ union SAG-AFTRA joined hands on the picket line. The aftermath of the strike is now echoing across Los Angeles, causing ripple effects on businesses of various scales.

Kevin Klowden, chief global strategist at the Milken Institute, which carried out the study, specified that caterers, dry cleaners, truckers, and car rental firms, among other small businesses underpinning the film industry, are all feeling the sting of the walkout. 

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This staggering figure overshadows the anticipated damage. Todd Holmes, an entertainment industry professor at Cal State Northridge, had forecasted a $3 billion hit to California’s economy in the initial 100 days of the strike.

The unions have halted work collectively for the first time since 1960, protesting the insufficient income from streaming platforms and potential disruptions from Artificial Intelligence. Consequently, Hollywood studios have started postponing new releases, as strike rules prevent actors from endorsing their films.

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