Hollywood business managers frequently saw themselves as canaries in the coal mine when a significant upheaval strikes the entertainment sector, acting quickly to protect and expand their customers’ assets at the first hint of danger or even before.

In the wake of the global COVID-19 outbreak, dual union strikes have halted film and television production, making it difficult to sound the alarm without inciting fear.

Naturally, the intention is to equip the A-list celebrities and elite creatives on their rosters to withstand financial storms before they arise, but this is frequently easier said than done.

SAG-AFTRA Talks End for the Day; Work to Resume on Sunday
“Simply stating your desire to cut costs is one thing,” says David Weise & Associates’ Robert Salzman. However, it requires dedication and diligence. David Weise frequently compares our offerings to those of a personal trainer. Working out is made simpler when you have someone encouraging you to complete the next rep. In our instance, it entails clients who are willing to schedule frequent meetings to discuss financial matters and examine useful indicators.

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While it would seem reasonable to believe that the 2020 COVID-19 pandemic shutdown would have made it a priority for Hollywood employees to make arrangements for any unanticipated catastrophes in the future, business managers claim that hasn’t always been the case.

Abacus Financial Business Management principal Belva Anakwenze claims that during the COVID-19 pandemic, government assistance in the form of cash transfers and forgiven PPP business loans provided a lifeline. While strike funding have been available, and some celebrities and producers have managed to keep their employees employed during the shutdown, there hasn’t been any federal assistance comparable to that during the labor movements.

Anakwenze says, “The strikes have taught our clients significantly more than the COVID-19 pandemic.” “Although we stress the value of cash reserves, the assistance during COVID-19 gave rise to misplaced optimism. The strikes have demonstrated that safety nets are not always provided, thus it is essential to build and keep your own easily available. She stresses once more that preparing for a rainy day entails more than just building up cash reserves, saying that having assets up for sale and credit lines open are crucial. We have been advising clients to use their assets as collateral to obtain operating capital.

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Some were caught off guard by the simultaneous strikes that brought the entertainment industry to a complete halt just three years after the shutdowns caused by the epidemic, even though company managers and their clients were still keeping an eye on the industry’s evolving recovery.

Justin Sroka of Mann Gelon Glodney Gumerove Yee notes, “With COVID so recent in the rearview mirror, clients have become more adjusted to dealing with events impacting traditional income streams like the strikes, which has management teams proactively diversifying for sustained success and comfort despite the slowdowns.”

The recently completed WGA strike and the ongoing SAG-AFTRA labor action, which has already lasted for 100 days, have made it difficult for anyone, even those who were well-prepared, to maintain their financial situation.

READ MORE: The Actors’ Union And Hollywood Studios Have Halted Negotiations

According to Steves Rodriguez, co-founder of Freemark Financial, the first phase involved doing an active analysis of spending. “The first item on the list is usually to eliminate as much discretionary spending as possible,” he explains. “One would also consider the biggest expense categories, which include homes for a lot of individuals. Therefore, considering innovative housing alternatives is one of the more significant adjustments that can be made.

Adds Grant’s Howard Altman Tani Barash and Altman: “Determine what is vital. Sort the issues that must be resolved right away from those that can wait. Make a clear strategy and course of action. When there is a clear plan in place, everyone feels more organized and ready for anything.

For numerous individuals, moving forward has necessitated much more than just decreasing expenses.

READ MORE: Hollywood Strikes Have An Effect Outside Of The Entertainment Business

Carrie Malcolm of CRM Management says, “Unfortunately, some clients have had to go into their pension accounts and either borrow or liquidate some of their assets.” “And the banks have been hesitant to lend to unemployed actors and writers in situations where mortgage rates have changed or people have had to relocate.”

The predicament has prompted some people to take difficult decisions and have unpleasant conversations, particularly in light of the fact that some people upgraded to more expensive homes during the boom years. It’s never easy to tell a client they need to sell their house or fire employees, according to Larry Witzer of Gettleson Witzer & O’Connor.

It appears that the collective trauma of the entertainment industry has compelled artists and creatives in the business to reevaluate their goals and ambitions in terms of money this time around. According to Steven Campeas of SJC, “we can’t escape the reality that bad things happen to good people, no matter how creative a person is.” “There will always be an unforeseen event or expense that calls for money we didn’t plan to spend. Though it occasionally lasts for months, the “rainy day” will inevitably come—I’m not a pessimist. This blow made the message very clear.

READ MORE: As The Effects Of The Hollywood Strike Spread Internationally, Tumbleweed Sweeps Across UK Film Studios

The financial strain caused by the two strikes has also rekindled discussions and concerns about the future of content spending by major studios and streaming services following the end of Peak TV, the constantly changing online video platform economy, and the implications of generative artificial intelligence in the workplace.

Gursey | Schneider’s Marie Ambrosino advises clients to be optimistic despite the difficult business environment by telling them to “stay the course on what matters most in your life, keep your faith, and make well-thought-out decisions.”

Business managers report that, on the whole, this year has seen clients become more aware of their financial status, more reflective, and more open to making future adjustments.

“I’ve heard that I need to review my spending after the strike,” says Gettleson Witzer & O’Connor’s Randy O’Connor. “Our clients are now aware that they need to challenge and cut back on the substantial fixed spending base they have amassed.”

Naturally, it’s impossible to predict when “after the strike” will occur. SAG-AFTRA is back at the negotiating table after so far failing to reach an agreement with the AMPTP; however, even when it does, the lives of Hollywood workers could very well be turned upside down again the following year as the industry looks ahead to the 2024 labor contract battles. The 2023 WGA strike lasted for 148 days before the protracted work stoppage ended with a new deal for screenwriters. Heading to the bargaining table are the Hollywood Teamsters, IATSE, and unions that are a part of Hollywood Basic Crafts, such as IBEW Local 40, LIUNA! Local 724, OPCMIA Local 755, and UA Local 78.

All of which highlights the necessity of keeping up the proactive approach for Altman: This has emphasized how crucial it is to understand the industry’s volatility, that nothing is certain, and why significant savings and buffers are necessary.


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