MPAA: Hollywood Spreads Wealth Across U.S.

The American film industry created 2.5 million jobs in 2007 and generating $41.1 billion in wages.

Last Updated: April 22, 2009 @ 6:35 PM

The economic impact of the American film industry is now spread around the country, according to a report released Tuesday by the Motion Picture Association of America (MPAA), creating 2.5 million jobs in 2007 and generating $41.1 billion in wages.

The report found that film production takes place in every state, and is a significant source of revenue in places like Texas, Florida, Georgia, Illinois, New Jersey, Pennsylvania, and Virginia — the top filmmaking states after New York and California. 

The report, titled “The Economic Impact of the Motion Picture and Television Industry on the United States,” was released in conjunction with Tuesday’s MPAA’s ‘Business of Show Business’ symposium in Washington, D.C. 

“I think the overarching message is the motion picture and television production industry has a very, very significant impact on the total U.S. economy,” MPAA chairman Dan Glickman told The Wrap in an interview prior to the report’s release. “This is a national industry.” 

About 30 percent of the 2.5 million industry-related jobs were in core moviemaking businesses or at cable companies, movie theaters and other companies involved in film distribution including online distributors. The other 70 percent of jobs were at firms that do business with the film industry, from caterers to transportation companies. 

Hundreds more projects are filmed in each state every year, with film studios opening in places like Anchorage, Alaska; Albuquerque, New Mexico; Plymouth, Massachusetts; and Wilmington, North Carolina. 

Albuquerque Studios, for instance, has generated more than $313 million in revenues since the 400,000 square foot facility opened in June 2007.  

Detroit Center Studios and Motown Motion Pictures are just  two of the many film-related facilities under construction  in Michigan. The economically depressed state stands to gain nearly 6,000 new jobs as a result of all the new projects.   

The symposium will include Commerce Secretary Gary Locke, House Judiciary Committee chairman John Conyers, House Energy and Commerce Committee chairman Henry Waxman and actor Dwayne “the Rock” Johnson. 

Top executives from Universal Studios, Universal Pictures, Warner Bros. Entertainment, Walt Disney Studios, Sony Pictures Entertainment, Paramount Pictures Corporation, and Fox Filmed Entertainment are scheduled to attend, while director Martin Scorsese is scheduled to receive the Jack Valenti Humanitarian Award at a private dinner Tuesday evening.

“We thought it was useful … to show congressmen and senators the importance and significance of this industry as a business and as an economic factor, particularly in the recession and tough economic times that were having now,” Glickman said of the day-long event.

According to the report, more than 115,000 firms across the country were directly involved in the film production or distribution business in 2008, and the overwhelming majority, more than 80 percent, employed less than 10 people. “A huge number of small businesses in all 50 states comprise this industry and supply us with goods and services,” Glickman told TheWrap. 

The film production industry paid vendors $38.2 billion for goods and services in 2007,  the report notes. The movie, "Marley & Me," for instance, injected more than $12 million into the economies of Florida and Pennsylvania, the two states where it was filmed. 

State and federal governments also collected $13 billion in income and sales taxes from the industry.  

Foreign sales of American-made movies, television and DVDs in 2007 were at their highest level since tracking began in 1992. The industry earned $15 billion from exports that year, a 23 percent increase over 2006, with the major motion picture studios deriving nearly half their revenues from abroad, the report states. Those sales resulted in a $13.6 billion trade surplus for the industry. 

“No other industry has the balance of payments surplus with the whole world like we do,” he said. “Given that, especially when the economy is in a recession, it’s very important for us to make the case that this is a business and that it’s an important business in America. I think too often the rhetoric about Hollywood and film production isn’t related to that.” 

Glickman characterized the state of the U.S. entertainment industry as “a mixed bag.”

“Certainly the cinema business is pretty good,” he said, but added, “the DVD business is down some. The television business is not doing well because of advertising revenues being down.”