MPA Study Projects Federal Film Tax Credit Would Create 143,000 Jobs and $125 Billion in Spending

When a major studio justifies moving a marquee television shoot to the United Kingdom or Canada, the explanation usually boils down to a shrug and a spreadsheet: American labor is simply too expensive to sustain domestic filming. A new economic analysis commissioned by the Motion Picture Association takes that premise and flips it, arguing that a 20 percent federal tax credit would not only reverse the exodus but generate 143,000 domestic jobs and inject $125 billion into the American economy by 2035.[1]

The report, prepared by the consultancy Olsberg SPI and released Tuesday, arrives at a moment when the entertainment industry's center of gravity is visibly tilting overseas. According to figures cited by Senator Adam Schiff (D-Calif.), 45 percent of all U.S. films and scripted television shows were shot internationally last year, a sharp increase from 33 percent in 2022. That shift contributed to the loss of 42,000 jobs in the Los Angeles motion picture sector alone between 2022 and 2024.[4]

"State programs cannot simply substitute for the kind of global, federal and competitive tax incentives that are needed to bring production back to American soil and stop its offshoring," Schiff noted during a recent push for the legislation. The proposed federal incentive would offer a baseline 20 percent credit on all labor costs, including salaries for actors and crew members, effectively subsidizing the most expensive line items on a call sheet.[1][4]

The sheer scale of the MPA's projections illustrates what the lobbying group believes is at stake. Without federal intervention, the study estimates annual U.S. production spending will hover around $16.7 billion by 2035. With the tax credit in place, that figure is projected to reach $38.7 billion—more than doubling the domestic industry's economic footprint.[1]

That kind of windfall has forged one of the most unusual political alliances in recent memory, uniting Hollywood labor unions, Democratic lawmakers, and President Donald Trump. The former president recently took to Truth Social to endorse the concept, declaring that "Hollywood is a Complete and Total Disaster" and urging Congress to "approve, immediately, a Federal Production Incentive to create Entertainment Jobs in America."[3][4]

Schiff, who has spent much of his career at odds with Trump, publicly welcomed the endorsement. "I am in strong agreement with the President," Schiff wrote on X, adding that Congress should immediately pass the incentive to reclaim jobs lost to foreign competitors.[4]

Yet the enthusiasm for a federal bailout is not universal, particularly among economists who study the long-term efficacy of such programs. Researchers at the USC Price School of Public Policy have previously noted that while state-level film incentives often succeed in poaching productions from neighboring states, they rarely create a net increase in national employment.[2]

A federal credit, however, changes the math by targeting international competitors rather than domestic rivals. If the incentive successfully lures shoots back from London or Vancouver, the resulting employment bump would represent genuine national growth rather than a simple reshuffling of the domestic deck.[2][5]

The challenge now lies in navigating the legislative machinery of a divided Congress. While the MPA study provides the statistical ammunition needed to court skeptical lawmakers, the actual drafting of a bill will require negotiating complex add-ons, such as bonus credits for independent productions or shoots located in rural areas.[1][4]

For the thousands of lighting technicians, set designers, and carpenters who have watched their livelihoods migrate across the Atlantic, the bipartisan momentum offers a rare glimmer of optimism. The next step is translating a 143,000-job projection into a binding piece of tax code before the current legislative window closes.[1][5]