Film and TV Production Is Shifting Away From California — And the Numbers Prove It
For decades, California has been the unquestioned center of the film and television industry. Major studios are headquartered in Los Angeles, talent lives nearby, and Hollywood’s identity is deeply tied to the state. But new production data shows that dominance is no longer guaranteed.
Despite California dramatically increasing its tax incentives to keep productions local, more film and TV projects are choosing to shoot elsewhere. States like New York, New Jersey, and Illinois are seeing major gains, while California continues to lose ground.
The latest fourth-quarter 2025 production report reveals a changing landscape — one where incentives, infrastructure, and cost efficiency are driving decisions more than tradition.
California Doubles Incentives, But Productions Still Decline
A Major Policy Move With Limited Immediate Impact
In July, California Governor Gavin Newsom signed legislation that more than doubled the state’s annual tax incentives for film and television production. The program jumped from $330 million to $750 million per year — a clear acknowledgment that runaway production had become a serious threat.
The move was meant to send a strong message: California wants to keep Hollywood at home.
However, new data suggests that the increase may not be enough — at least not yet.
According to industry tracker ProdPro, California saw a 20 percent year-over-year drop in the number of film and TV projects shooting in the state during the fourth quarter of 2025. Even more concerning, production spending fell by 22 percent during the same period, landing at $1.35 billion for the quarter.
Those are significant declines, especially following such a major incentive expansion.
Los Angeles Sees a Small Uptick, But the Bigger Picture Is Troubling
Short-Term Gains, Long-Term Challenges
There was one modest bright spot. FilmLA reported that filming days in Los Angeles increased by about 6 percent in the fourth quarter compared to the previous quarter.
But that improvement doesn’t erase the broader trend.
Over the full year, Los Angeles filming days were down 16 percent compared to 2024. That signals ongoing structural challenges, not just a temporary slowdown.
FilmLA executives have urged patience, pointing out that dozens of incentivized projects approved late in the year have not yet started filming. In December, the California Film Commission announced 28 new projects receiving tax credits, including productions from NBCUniversal, Sony, Amazon, 20th Century, and Apple.
The state projects those shoots will generate more than $560 million in economic activity — but the real test will be whether that momentum continues.
New York Is Closing in on California
Production Spend Nearly Matches the Golden State
While California struggles, New York is thriving.
In the fourth quarter of 2025, New York saw a 31 percent increase in the number of productions filming in the state year-over-year. Production spending rose by 23 percent, reaching $1.07 billion for the quarter.
That puts New York surprisingly close to California’s total production spend — a gap that was once unthinkable.
New York’s success is fueled by a generous $800 million annual tax incentive program, strong infrastructure, and a deep talent pool. For many productions, the state now offers a compelling alternative that rivals California in both scale and capability.
New Jersey Emerges as a Major Player
Explosive Growth Before Studios Are Even Finished
One of the most striking developments in the latest data is the rapid rise of New Jersey.
In the fourth quarter, the state saw a massive 75 percent year-over-year increase in filming activity. Production spending grew by 12 percent, a strong showing even before several major studio projects are completed.
New Jersey’s annual tax incentive program stands at $430 million — smaller than New York’s and California’s, but clearly effective.
What makes the growth even more impressive is that it’s happening ahead of major infrastructure expansion.
Netflix is investing $1 billion to build its East Coast production hub at the former Fort Monmouth site, which will include 12 soundstages. Paramount has signed a 10-year lease at 1888 Studios in Bayonne, and Lionsgate is set to anchor Great Point Studios in Newark.
Once these facilities are fully operational, New Jersey’s production numbers could rise even further.
Illinois Gains Momentum as a Production Hub
From Regional Player to National Contender
Illinois is also seeing significant growth.
The state recorded a 70 percent year-over-year increase in film and TV project counts in the fourth quarter. Production spending jumped by 46 percent — one of the strongest gains among U.S. states.
Chicago-based series like Chicago Fire, Chicago P.D., Chicago Med, and FX’s The Bear have helped anchor the state’s production ecosystem. But recent indicators suggest Illinois is expanding beyond its traditional base.
Payroll data showed earlier increases in background actor bookings, signaling rising activity. The latest figures confirm that Illinois is closing the gap with more established production centers.
Notably, Illinois appears to be outperforming Georgia in recent quarters, as Georgia saw year-over-year declines in both filming activity and spending.
Georgia Slows After Years of Growth
A Warning Sign for Incentive-Driven Markets
Georgia has long been one of California’s strongest competitors, benefiting from aggressive tax incentives and large-scale studio development.
However, the fourth quarter data shows declines in both production count and spending year-over-year.
While Georgia remains a major player, the slowdown highlights how competitive and fluid the production market has become. Incentives alone may not be enough without continued infrastructure investment and long-term stability.
U.S. Production Overall Is Still Down
A Global Race for Incentives
Even with strong gains in select states, overall U.S. production declined in the fourth quarter.
Across all states, film and TV production fell by 4 percent, while total production spending dropped 8 percent to $4.2 billion.
This points to a larger issue: production is not just moving within the U.S. — it’s increasingly going global.
Producers are chasing the best financial deals wherever they can find them, often outside the country.
The Global Competition: UK and Canada Surge
International Markets Gain Ground
According to ProdPro, both the United Kingdom and Canada saw double-digit growth in production count and spending during the fourth quarter of 2025.
Strong incentives, favorable exchange rates, and experienced crews continue to make these countries attractive alternatives to U.S. states.
As international competition intensifies, U.S. states are not just competing with each other — they’re competing with the world.
What This Means for Hollywood’s Future
Incentives Are Necessary, But Not Enough
California’s decision to expand its tax incentive program was a crucial step, but the data shows it may take time to reverse years of runaway production.
States like New York, New Jersey, and Illinois are proving that aggressive incentives combined with infrastructure investment can reshape the production map.
The fight to keep Hollywood jobs, spending, and talent local is far from over.
For now, the industry is in flux — and where the next big show or blockbuster film lands may depend less on legacy and more on who offers the best deal.
Final Takeaway
Hollywood is no longer tied to a single location.
While California remains the industry’s symbolic and logistical center, real production power is spreading across the country — and beyond it.
If current trends continue, the future of film and television will be defined not by where studios began, but by where they are most welcomed.
