Hollywood’s workforce just needed to “survive ’til ’25.” That was last year’s hopeful mantra for entertainment industry pros battered by layoffs and limited film and TV production.
But now as the year approaches its halfway point, a bleaker saying seems apt: “Exist ’til ’26.”
Rosy projections of a robust recovery this year have not materialized. If anything, the downturn, at least in terms of employment at the studios, has continued.
In recent weeks, three media and entertainment giants — Walt Disney Co., Warner Bros. Discovery and Paramount Global — have said they will lay off staffers. Disney cut several hundred employees in the U.S. and abroad, while Paramount shed hundreds of its domestic workforce and Warner Bros. eliminated several dozen positions.
It is yet another sign that the industry is still recovering from the effects of the pandemic and the dual writers’ and actors’ strikes of 2023, while also trying to navigate the changing media landscape.
As people continue to cut the cord and viewership of traditional broadcast television declines — taking with it valuable ad dollars — companies are reallocating resources to their streaming platforms. They’re cutting back on spending after massive investments during the so-called streaming wars. And now, economic uncertainty from President Trump’s tariffs has rattled the markets, creating a difficult overall business environment.
“We’re going through this squeezing of our ecosystem in Hollywood,” said J. Christopher Hamilton, a practicing entertainment attorney and a professor at Syracuse University who focuses on the business of media. Companies are “trying to find a new normal, adjust to the financial pressures that the global economy is under and also figure out what is the smartest business model and path forward.”
It’s a far cry from the hints of optimism some in the industry had toward the end of last year. With the strikes finally in the rearview mirror, and delayed films debuting in theaters and production slowly coming back, the thought was “we’re out of the strikes, we’ll be able to go back to the market, sell and buy,” Hamilton said.
Instead, many of the recent conversations he’s had with clients and media executives have been centered on fear and uncertainty. People will tell him that it’s hard to sell a TV show, or that they don’t know if their job will be around in two weeks. The international market has also become more favorable to local content, meaning U.S.-made shows are now heavily competing with homegrown series.
“It’s a horrible time in the business from the content creation, content production standpoint,” Hamilton said. “People don’t want to take risks. They’re fearful of losing their jobs.”
The idea of “survive ’til ’25” was always a myth, said Stephen Galloway, dean of Chapman University’s Dodge College of Film and Media Arts. The issues the industry is facing are long term and disruptive.
“The industry is retrenching,” he said. “And there’s going to be a shake-up that lasts for quite a while.”
The continued decline of linear TV is one issue nearly all studios are grappling with. Though viewership is down and can drag on a company’s stock price, traditional broadcast TV still makes money, making it important to manage costs and generate profit for as long as possible.
That also means job cuts in those areas.
Disney’s layoffs hit its film and television marketing teams, television publicity, casting and development as well as corporate financial operations. Warner Bros. cut employees from its cable TV channels. While Paramount did not disclose the departments affected by the layoffs, its co-chief executives acknowledged in a note to staff that the decision came as the company navigates “continued industry-wide linear declines.”
Linear TV’s struggles have led media companies to spin off their traditional television assets, including cable networks, into separate entities. Santa Monica-based Lionsgate got the ball rolling in 2023 when it said it would sever its film and TV studio business from its pay cable unit Starz, a transaction that was completed this year.
Late last year, Comcast Corp. said it would make a new company consisting of its cable channels, including CNBC, MSNBC and USA Network. Then on Monday, Warner Bros. said it too would split into two publicly traded companies — one entity called Streaming & Studios and a second called Global Networks, that would consist of its cable channels such as CNN, TNT and Discovery.
The Warner Bros. split is “an acknowledgment that the idea of building something big enough to compete in the streaming war didn’t work,” said Peter Murrieta, a writer and deputy director of the Sidney Poitier New American Film School at Arizona State University. Moreover, Netflix’s dominance in the streaming space has made many companies reevaluate their plans.
“There were already signs pointing to the unsustainability of the number of shows and the number of streamers,” he said. “It’s the aftereffects of trying to compete at the streaming level and thinking that’s the future. Resources were put there, and now they have to retrench.”
Disney Chief Executive Bob Iger has said as much in comments to Wall Street, acknowledging that the House of Mouse pumped out too many shows and movies to compete against Netflix.
The company has since pulled back amid Iger’s call to focus on quality over quantity and to reach profitability in its streaming services, which it achieved last year. The company’s latest job postings now include a number of openings for software engineers.
The larger economic environment, too, is of concern to those in Hollywood. In addition to industry-specific concerns about artificial intelligence and the decline of traditional TV and cable, the entertainment business is also grappling with domestic and global financial uncertainty. Paramount’s executives cited the “dynamic macro-economic environment” in its note to employees.
“Right now, there is an absolute sense of terror among people in the business that they’ll be out of a job, that the old models aren’t working, that they won’t earn what they once did,” said Galloway of Chapman. “They’re not wrong to be afraid. I think they’re wrong to be as afraid as they are because it’s a retrenchment, and it’s a retrenchment following a gigantic expansion.”
White-collar jobs in other industries are also being threatened by technological change, greater investment in AI and retrenchments after pandemic-era hiring sprees. Earlier this year, tech companies such as payment firm Square, Meta, Google and Workday said they would lay off employees.
But Hollywood has always been a boom-and-bust industry, Galloway said, noting that in times of change, new opportunities always arise. Jobs in virtual production or AI are becoming more numerous. As studios cut back on their staff, they will still need producers to shepherd shows and films, said Susan Sprung, chief executive of the Producers Guild of America trade group.
“These companies aren’t getting out of the business of producing great programming, movies and television,” she said. “If you don’t have as large of an executive team that can help supplement that, it makes it even more important that you have good producers working on every one of your projects.”
While the current environment is tough, the industry has always been difficult, and people in this business are resourceful and intentional about their work, said Murrieta of Arizona State.
Though it is a trying time, he said, “there’s got to be hope.”
