Animation? Going Away?

This is a (sort of) followup to the Wages post down below which bears scrutiny. We noted that wages have stayed relatively level the past few years (they did decline in the late nineties after the 'toon boom of hand-drawn animation ran its course. A commenter said:

The more we ask, the more likely they will take the business overseas eventually. It is already happening, the problem is you can never compete against the people who are willing to work with 1:5th of your salary no matter how good you are!

There's truth to the observation that animation work has shifted overseas. If you see new episodes of The Flintstones or a Daffy Duck feature-length cartoon, the odds are good that some or all of the production work was done in the Phillipines, Korea, maybe mainland China. But this is far from the whole story.

As I've said before, when all animation production work was done in Los Angeles start to finish, there were about 1500 TAG members doing the work (and kindly note that almost all L.A. cartoon studios were unionized at the time.)

Forty-five years later, with union contracts covering 85% of t.v. and movie animation work in L.A., with 80% of television production work (animation, background, and layout) being shipped out of county), there are 2200 TAG members doing the work.

How can this be? Because the animation pie has gotten bigger. Way bigger. Forty-five years ago there was television animation (all done here), feature animation (i.e. Disney), and some commercials. Today there are games, the internet, t.v. animation, feature animation, visual effects, broadcast graphics, and so on and so forth. Where once there were a couple of thousand people employed in Southern California in animation, today there's five or six times as many (and newer media is mostly not unionized.)

Make no mistake. Southern California is one of the high-rent areas on the planet in which to produce animation. It can be done a number of places for less money. But as more than one producer has said to me and/or TAG's members:

"L.A. is where the big animation talent is..."

So animation producers are faced with a choice. They can go to India, or China, or Bangladesh, and they can get a project done more cheaply. But they lose quality and they lose quality-control, and if those things are important -- as often they are -- then hey. They don't do it there.

There's another wrinkle, told me by an animation software executive this very day: Sub-contracting studios on the Pacific rim are now faced with skyrocketing labor costs as their employees move into the middle class. So American studios have much bigger cash outlays going to their (previously) inexpensive foreign sub-contractors. One solution, of course, is to simply chase after the latest low-cost provider in Kurdistan or wherever, and in many cases this is being done. But then the old issue of "quality" once again rears its ugly head.

Many studios are going (or will go) a different route: The L.A. talent pool, combined with newer, more powerful animation software, is a strong magnet for many producers, and makes production in Los Angeles feasible in ways it hasn't been in decades. Television animation hasn't been created in L.A. in years, yet Cartoon Network and Renegade Animation (and probably studios I don't know about) are doing it for television.

There are three feature animation studios in town, as well as four large visual effects houses. Game studio Electronic Arts has a new, not inexpensive facility in Playa Del Rey.

And how many of these places are here because L.A. County offers the most bang for the employment buck? None. Nada. But L.A. is where the creative action is, where the deepest pool of talent is, where the infrastructure is. This isn't to say that the talent magnet will be here forever, or that other centers can't grow and develop (obviously many have...can we spell E-M-E-R-Y-V-I-L-L-E?), but it is to say that the demise of L.A. based animation has always been overblown.

Walt didn't grow his animation studio in L.A. rather than low-cost Kansas City for no reason.