The $111 billion Paramount Skydance takeover of Warner Bros. Discovery threatens to eliminate 2,500 jobs in Los Angeles County as the combined company targets $6 billion in cost savings.
Back
Paramount Skydance-Warner merger puts 2,500 LA jobs at risk
The $111 billion Paramount Skydance takeover of Warner Bros. Discovery threatens to eliminate 2,500 jobs in Los Angeles County as the combined company targets $6 billion in cost savings.
The $111 billion Paramount Skydance acquisition of Warner Bros. Discovery puts about 2,500 jobs in Los Angeles County and 6,000 globally at risk, the county's Department of Economic Opportunity said Thursday.
"The findings reinforce what workers, employers, and small businesses have been telling us for years: our entertainment economy remains in a fragile recovery period," Kelly LoBianco, director of the DEO, said.
The combined entity would carry about $82 billion in gross debt, roughly seven times annual profits, the report found. Paramount Skydance projects $6 billion in savings by eliminating duplicate corporate functions, streamlining technology systems and consolidating real estate — areas concentrated in Los Angeles County. Of 19 films scheduled for release this year from both studios, only one was primarily shot in California.
The job losses would compound damage from the pandemic, the 2023 Hollywood labor strikes and the January 2025 wildfires. Production activity in LA County declined 16 percent in 2025 from a year earlier, according to FilmLA data. The county's entertainment industry employs about 325,000 workers directly or indirectly, generating $117.2 billion in annual economic impact.
The U.S. Department of Justice cleared the merger this month without demanding concessions, saying the transaction would not harm competition. But California Attorney General Rob Bonta is coordinating with other states on a potential lawsuit to block the deal, the report said.
"Nothing is off the table when it comes to protecting our workforce, our economy, and the future of the entertainment capital of the world," said Lindsey Horvath, the LA County supervisor who authored the March motion requesting the analysis.
Debt Burden and Production Flight
The $82 billion debt load — unusually high relative to the combined company's earnings — raises questions about whether the merged entity can sustain its obligations while maintaining production output, the CVL Economics analysis found. The combined company has said it plans to release 30 theatrical films annually, but Los Angeles is poorly positioned to capture that production. "Given the trajectory of local production in recent years, Los Angeles is not well positioned today to capture much of that hypothetical increase," Adam Fowler, co-founder of CVL Economics, said.
More than 1,000 entertainment professionals signed an open letter in April opposing the merger, arguing it would reduce competition in an already concentrated industry.
Policy Response
California Governor Gavin Newsom signed legislation last year doubling the state's film and television tax credit program. The DEO's final report, due in August, will include a workforce action plan with job training, streamlined unemployment benefits and job fairs targeting laid-off workers for adjacent sectors such as digital media, gaming and live events. The Board of Supervisors has also directed the County Counsel Office to submit formal comments to the DOJ regarding antitrust concerns.
This article is for informational purposes only and does not constitute investment advice.
