LABOR MATTERS
Just How Bad Was 2005 for the Film Business?
compiled by Jeff Burman
 Jeffrey Burman |
By national standards, the film business has nothing to worry about. But in a business that adores drama, there were some dramatic declines.
In the US, 2005 box office revenues were down 5.2 percent from last year, according to the Associated Press. A slump that lasted most of the year put Hollywood in the hole, with domestic revenues finishing at $8.945 billion, resulting in total grosses below $9 billion for the first time since 2001. Box office was $9.2 billion in 2004.
With the exception of blockbusters, nothing worked as well last year, writes Ben Fritz in Variety. “While the top 15 films of 2005––those with domestic totals over $120 million––were on par with the top films last year, every film below number 15 in the top 100 did worse than the one with the same rank in 2004… As has been the trend since 2002, rising ticket prices hide an even sharper drop in admissions––11 percent to 1.32 billion from the 1.48 billion last year,” adds Fritz.
Significantly, home video purchases declined for the first time in over 25 years, writes Scott Hettrick in Variety. Unofficial projections for overall spending on DVDs and videocassettes in the US for 2005 indicate a drop of less than 1 percent from the $24.1 billion last year, according to Daily Variety’s sister publication DVD Exclusive, now defunct. At the halfway point of last year, revenue from home video sales––which is now almost entirely DVDs––was up just 2.5 percent, according to Video Business. This is compared to the 15 percent gain during 2004, writes Gabriel Snyder in Variety.
 Cartoon by Brian Fairrington, Cagel Cartoons, Inc. |
Outside the US, after a healthy 2004, international box office was hard-pressed to match the feat in 2005, bringing in $12 billion in grosses to mark a 4 percent dip, writes Dave McNary in Variety. Contributing to that decline, only four blockbusters earned more than $300 million abroad in 2005, compared with seven in 2004. Foreign distributors saw double-digit declines hit key international markets such as France, Germany, Italy and Spain, while the UK and Japan saw relatively little change. Figures from The Hollywood Reporter show that Germany was hardest hit by disgruntled cinema-goers in 2005, as ticket sales fell a huge 20.6 percent from the previous year. Spain experienced a 9.5 percent drop in revenue, France a 10 percent drop and Italy a more minor 7.5 percent dip.
New York Film Subsidies Create 6,000 Jobs
The introduction of the “Made in NY” incentive program
brought $600 million in new production business to New York and led
to the creation of jobs for more than 6,000 New Yorkers in 2005, writes
Addie Morfoot in Variety.
As a direct result of the program, more than 250 independent and studio films and 100 TV productions shot in New York’s streets and studios last year. Signed into law by Mayor Michael Bloomberg on January 3, 2005, the “Made in NY” tax credit offers a 5 percent credit from New York City on top of the state’s 10 percent credit for qualified film and television productions, adds Morfoot.
Casting Directors Approve Their First Contract
Hollywood casting directors and associates approved their first contract
with studios and networks, covering about 400 employees, writes Dave
McNary in Variety.
The agreement, between the Teamsters and the Alliance of Motion Picture
and Television Producers, began February 1 and runs to September 2008.
It includes benefits provided via the Motion Picture Industry Health
and Pension Plans.
The Teamsters spent three years organizing the casting directors, one of the few significant groups of Hollywood workers who had not been unionized.
Maryland Legislature Forces Wal-Mart to Pay Health Benefits
The Maryland legislature passed a law in January that would require
Wal-Mart Stores to increase spending on employee health insurance,
a measure that is expected to be a model for other states, writes
Michael Barbaro in The New York Times.
The legislature’s move, which overrode a veto by Governor Robert Ehrlich, was a response to growing criticism that Wal-Mart, the nation’s largest private employer, has skimped on benefits and shifted health costs to state governments, adds Barbaro.
Labor will take its major victory from Maryland’s health care vote to 31 other states, hoping to capitalize on anti-Wal-Mart sentiment and to build momentum in state legislatures considering similar measures, write Amy Joyce and Matthew Mosk in The Washington Post.
The Maryland victory shows the tide is turning, said an AFL-CIO press release. Working people are not just fed up––they are ready to get active to set our country in a different direction, one state at a time.
A Concerted Attack on Pension Plans
Several major newspapers and magazines have pointed to the January
announcement by IBM that it was freezing its traditional defined benefit
pension plan as a momentous event. Mary Williams Walsh, writing in
The New York Times, calls it a “death knell for the traditional
company pension.” IBM was not pressed into this decision by
bankruptcy, as has been the case for companies in the steel or airline
industries. IBM joins Verizon, Lockheed Martin and Motorola, some
of the nation’s most successful corporations, saying it is ending
its pension plan for competitive reasons, and that it plans to set
up an “unusually rich 401(k) plan as a replacement,” adds
Walsh.
This decision by a financially strong IBM suggests that corporate America’s shift away from traditional pension plans will likely continue––and that Americans will be forced to take an even greater role in their retirement finances, writes Neil Weinberg in Forbes. “The number of private pension plans fell by 75 percent over the past two decades to 31,000 and now cover a mere 20 percent of workers. In 2004 alone, 11 percent of surviving plans were frozen to new contributions, according to Barclays Global Investors. All told, less than half of US workers are now offered any pension plan at all––traditional or 401(k)-style,” continues Weinberg.
Employee activists are hopping mad. “It’s difficult to understand how they’re doing this in the context of wanting to be a world-class employer. You see companies of this stature––Verizon, IBM––seemingly in concert, in a race to the bottom for the defined-benefit system,” says John Hotz, deputy director of the Pension Rights Center, a Washington, DC consumer organization focused on retirement rights. “No matter what IBM wants to call it, it’s a cut in employee compensation, and it’s the sneakiest kind of pay cut, one employees won’t realize the full impact of until they reach their retirement years,” writes Nanette Byrnes in BusinessWeek.
“The announcement by IBM to slash hard-earned pensions for
some 120,000 employees fuels a devastating trend of large, profitable
employers choosing to retreat from their commitments to workers,”
writes John Sweeney, President of the AFL-CIO. “IBM’s
healthy profits make their actions especially difficult to stomach––especially
for IBM workers with many years of service who have been relying on
their retirement to be there.”
NLRB Majority Tips to Republicans
On January 4, President Bush used a recess appointment to install
Ronald Meisburg as General Counsel and Peter Kirsanow as a member
of the National Labor Relations Board. The appointment of Kirsanow
is significant, writes Ross Runkle in the online LaborLawBlog. For
the first time since December 2004, three Republican members now have
seats on the board, giving it the potential to overrule standing precedents,
adds Runkle.
“The AFL-CIO has grave concerns about President Bush’s decision to recess-appoint Peter Kirsanow to the National Labor Relations Board, bypassing the US Senate, where his nomination would have been controversial. In his writings and during his prior public service, Mr. Kirsanow has taken stands against the minimum wage, affirmative action, prevailing wages, voting rights legislation and other basic protections for workers and citizens, and he has expressed a marked hostility to unions,” writes John Sweeney, President of the AFL-CIO.
Collegiate Coke Boycott Expands to 23 Campuses
Boycott movements on college campuses tend to take hold if a critical
mass of well-known institutions participate. So critics of Coca-Cola
had much to celebrate as 2006 began, writes Scott Jaschik in the online
Inside Higher Ed. Critics say that 23 colleges worldwide have now
banned Coke products from their campuses. And in the US, they have
now hit a total of ten, including bans approved in December by two
large colleges––New York University and the University
of Michigan. The anti-Coke movement says that the beverage giant is
complicit in murders and attacks on union organizers in Colombia and
in environmental damage in India––charges that the company
denies, adds Jaschik.
Sago Mine Disaster was Avoidable
 Darrell Ware, center, son of Sago miner Fred Ware, Jr. of Buckhannon, West Virginia, along with ex-wife Brenda Newcomer, right, of Strongsville, Ohio, places a rose onto his father's casket before it is lowered into the ground Tuesday, January 10, 2006, at Mount Olive Cemetery in Hinkleville, West Virginia. Ware perished following a mine explosion January 2. AP Photo/Jeff Gentner |
While the explosion that led to 12 deaths at the Sago coal mine in
West Virginia is by now old news, a couple of perspectives deserve
our attention.
Although United Mine Workers representatives participated in the attempted
rescue of the Sago miners in January, the mine was non-union, writes
Jordan Barab in the online Confined Space. Sadly, that fact may have
contributed to the miners’ deaths. According to David Bonoir,
Chairman of American Rights at Work, “These workers did not
have to die. Accidents happen, but they shouldn’t be as frequent
and they don’t have to be fatal. Better safety precautions in
the mine could have been achieved had the workers had a voice––a
union.”
The owner of the International Coal Group, which owns the Sago mine,
is corporate takeover artist Wilbur Ross, Jr. He made his fortune
buying up bankrupt firms in a variety of industries after they shed
pension and health obligations to their workers. After purchase, safety
at these companies plummeted, thanks to the weakening or elimination
of unions, as well as non-enforcement of safety laws and regulations
by state and federal authorities, writes Andrew Pollack in the Monthly
Review
Jeff Burman represents Sound Editors on the Guild's Board of Directors. He can be reached at jeffrey.burman@nbcuni.com.