"Production just sort of drifted away. And so if you are a member of the International Alliance, you're struggling," said Jack Kyser, Los Angeles Economic Development Corporation.
Part of the reason for the slowdown is that the studios were worried about the Screen Actors Guild contract. Most of the studios scheduled their filming so they would be wrapped by the middle of the year. Michael Bennett from FilmL.A. says there was a record second quarter.
"We did see what could be a compression of shoots that went forward. But by about the middle of the July month, most of those had wrapped and we saw sort of a flattening after that," said Bennett.
FilmL.A. coordinates film permits in Los Angeles. The company says one of the bright spots is TV production, which is gearing up for the fall season. However, it is major motion pictures that bring in major money.
"Right now the people at the studios are just sort of saying, 'Well, we have enough film done that this will carry us well into 2009, and so we don't need to rush,'" said Kyser.
Some film productions are leaving California all together. Canada and other states are providing tax incentives. It is simply much cheaper to shoot elsewhere.
"I think that's going to continue," said Bennett. "I think until the state of California circles their wagons around the film industry's community, and what they want to do for them, we're going to continue to see this exiting of film production companies."
Some in the film industry say they don't expect an actors strike. Three films may begin shooting locally by the end of 2008.