What the Summer of Strikes Means For The Broader Economy

Episode Summary

Executive Summary: Live at Bloomberg’s Screen Time Conference, Joe Weisenthal and Tracy Alloway speak with economist Omer Sharif about how the writers’ and actors’ strikes affect economic data, wages, inflation, and California’s entertainment industry. The discussion also connects labor militancy to broader post-inflation wage pressure, the UAW, and even Taylor Swift’s measurable impact on hotel prices and CPI.

Main Topics: How strikes show up in economic data (Priority: 5/5): Sharif explains that large strikes appear first in BLS work-stoppage data and some labor-force categories, but not necessarily in unemployment claims because many striking workers have other jobs or are not classified as unemployed. Wages and income realities for actors (Priority: 5/5): The conversation uses wage distribution data to show most actors earn very little, with median pay around $15-$16/hour, and only the top 10% seeing materially higher wages. Entertainment industry weakness predated the strikes (Priority: 5/5): California shoot-day data and employment trends show the film/TV sector was already contracting before the writers’ and actors’ strikes began, suggesting structural pressure beyond labor disputes. Strike activity, inflation, and labor power (Priority: 5/5): Sharif argues strikes usually follow inflation shocks rather than cause them, reflecting workers trying to catch up after real wages erode; this wave is also tied to profits, AI, EVs, and shifting industry models. Comparing Hollywood to the UAW (Priority: 4/5): The hosts and Sharif discuss why the entertainment strikes are not directly comparable to the UAW because workers have different labor markets, strike rules, and fallback jobs, limiting read-through across sectors. Taylor Swift as an inflation data point (Priority: 3/5): Sharif notes that Swift’s tour visibly moves hotel rates and can distort inflation prints, illustrating how specific events can affect volatile service-price categories. What may end the strike wave (Priority: 4/5): Possible off-ramps include public backlash if consumers feel higher prices, or strike funds running low, but lower inflation alone may not resolve contract disputes because workers seek to recover past losses.

Key Arguments: Strike effects appear first in specialized labor data, not necessarily unemployment, because many strikers remain employed elsewhere or do not meet unemployment criteria. Actors are not a high-paid group overall; most earn around $15-$16/hour, so the strike reflects broad worker economics rather than A-list celebrity behavior. The entertainment industry was already weakening before the strikes, with falling shoot days and declining California production activity. Strikes tend to follow inflationary episodes, because workers seek wage catch-up after years of real-wage erosion. The current labor surge reflects both stronger union leverage and transformative industry changes such as AI in media and EVs in autos. The Hollywood strikes are not a clean proxy for the UAW; the labor structures, fallback employment options, and bargaining dynamics differ substantially. Taylor Swift’s tour materially affects local hotel demand and can distort CPI components, showing how pop-culture events can have macroeconomic effects. Lower inflation by itself may not end strikes, because workers are still trying to recover losses from prior years and lock in better multi-year contracts.

Data Points: Writers on strike: About 11,500 - Recorded in government work-stoppage data beginning in June Actors on strike: About 160,000 - Shown in the work-stoppage report as the actors’ strike spread Actors’ median wage in motion picture and video industry: $16.70/hour - Median pay cited for actors and related industry workers Actors’ median wage in Los Angeles area: $15.70/hour - Local median wage for actors in LA/Long Beach/Anaheim Actors’ bottom 10% wage in LA: About $15.60/hour - Shows very little spread at the low end of actor wages Actors’ 75th percentile wage in LA: About $16.70/hour - Still only about $1 above the median in the local distribution Actors’ 90th percentile wage in LA: About $70/hour - Top decile begins to pull away from the bulk of workers Actors’ 90th percentile wage in U.S.: Over $110/hour - National data show a larger top-end payoff than local data Servers’ wage in LA County: About $15.15/hour - Example of common side jobs for actors Bartenders’ wage in LA County: About $15.35/hour - Another common fallback occupation Substitute teachers’ wage in LA County: $23/hour - Higher-paying side job referenced in the discussion Real estate agents’ wage in LA County: About $31/hour - Illustrates varied fallback work among actors California film/TV and related industries job loss since April: About 17,000 jobs - Combined losses in film/TV and independent writer/performer categories after strikes began Average quarterly shoot days in California pre-COVID: About 9,500 - 2015-2019 benchmark for FilmLA shooting activity Shoot days by mid-2021: About 10,000 per quarter - Production rebounded after the COVID shutdown Shoot days decline from late 2021 to Q1 2023: Down every quarter; Q1 2023 was 20% below the 2015-2019 average - Shows industry weakness before strikes fully hit Shoot days in April 2023: About 6,500 - Lowest level since before 2015, even before the full effect of the strikes California unemployment rate: 4.5% to 4.6% - Little change despite strikes, due to classification and multi-job workers Private-sector union membership share in 2012: 6.5% - Historical context for union density Private-sector union membership share now: 6% - Union share has fallen even as attention has increased Current workers on strike: About 210,000 - Approximate total strike count nationally at the time of recording Major historical strike levels in the 1980s: 500,000-700,000 - Shows current activity is elevated but below prior peaks UAW strike participants at the time: About 15,000-20,000 of 140,000 - Targeted strike approach versus a full walkout UAW strike pay: $500 per week - Support fund for workers on strike Real wages for auto workers since 2008: Down about 10% - Used to explain bargaining pressure and catch-up demands Taylor Swift hotel rates spike: 55% increase - Hotel prices rose sharply in a region she toured Taylor Swift hotel rates after she left: Down 20% the next month - Illustrates rapid reversal in local prices Core services ex-housing annualized rate: About 7% - Used to describe the “super core” inflation pressure Overall annualized inflation pace discussed: Around 3.5% - Current trajectory judged too hot for the Fed Milken Institute estimate of strike cost: $5 billion - Estimated hit to the economy from the writers’ and actors’ strikes 2007-2008 strike cost estimate: $2 billion - Historical comparison to the current strike impact Potential annualized hit to LA GDP: Up to 2% - If strikes continue through the year California economy size referenced: $3.7 trillion - Used to show limited statewide macro impact U.S. economy size referenced: $24-$25 trillion - Used to show minimal national macro impact

Pivotal Quotes: "Our job is to ensure that our guild members have good jobs. Share in the value that we create as writers, regardless of whatever it is that the industry is doing." — Omer Sharif quoting Ellen Stetsman: Explaining the Writers Guild’s stance that labor should capture fair share even amid industry stress "The problem is going to be that you are hoping to get down to 2% on inflation. What looked like a trajectory that was going to get you there over the summer has now shifted higher." — Omer Sharif: On the Federal Reserve’s inflation outlook after recent CPI readings "You know, if you're an actor, essentially, unless you are in that top 10%, and quite honestly, probably that top 1%, your median wage is probably going to be around that $15 to $16 range." — Omer Sharif: Summarizing why actor pay data undercuts assumptions that all actors are high earners

Implications: Listeners should expect more labor data noise, sticky service inflation, and possible Fed concern if wage-and-price pressures persist. California’s entertainment downturn looks structural, while the strike wave signals stronger labor leverage across industries.