I Got 99 Seats, but Wage Equity Ain’t One

While Actors and Small Theaters Point Fingers at Each Other, We’re Missing Out on the Bigger Picture — Wealth Inequality

by Jason Tseng, Community Engagement Specialist at Fractured Atlas


At this point, everyone who’s anyone in the theatre world has heard about Actors Equity Association’s L.A. 99 Seat Theater Plan and the proposed revisions soon to come. For the uninitiated, click on the notes to the right.

The proposed changes would force theatre producers to pay actors at least the state-mandated minimum wage, which many producers claim is not economically possible. Unsurprisingly, this has created a firestorm in the L.A. theatre community as theatre makers square off against each other: Actors want to be paid a fair wage, small theaters say they can’t afford to — and invariably everyone is pointing fingers at each other.

But the real problem is not that actors are greedy or that small theaters are exploitative:

The real problem is that small theaters are not getting the funding that they deserve.

Back in 2011, Occupy Wall Street made economic inequality the ubiquitous issue of the year. The fleecing of the 99% by the top 1% was a powerful message that resonated with the average American, particularly in the wake of the 2008 Stock Market Crisis and the Great Recession in which the very wealthy gambled with (and squandered) the economic well-being of billions globally. Whether or not you agree with the Occupy movement, it’s undeniable that over the past few decades, the wealth gap between the haves and the have-nots has continued to widen.

It should be of no surprise to us that this same wealth inequality is reflected in our philanthropic systems. Earlier this year, Holly Sidford of Helicon Collaborative spoke at SphinxCon, an annual conference on Diversity and Inclusion in the Arts, where she outlined her updated research of the unequal distribution of funding in the arts and culture sector. (You can find the original report here.) In her findings, Holly shows that

the top 3% of arts organizations by budget size ($10M and above) received 60% of all arts and culture funding. Conversely, the bottom half of organizations by budget size ($100k and below) received only 5% of that funding.

Not only is this deeply problematic from a purely class perspective, Holly also notes that this wealth gap disproportionately effects racial and ethnic minority communities, as well as other oppressed groups. This phenomenon is also not limited to the U.S. In fact, a similar report out of Britain cautioned that drastic changes to arts funding need to occur in order to avoid a “cultural apartheid.”

What does this have to do with the 99 Seat Plan?

Everything.

Much like the rest of the arts sector, the L.A. theatre community (and nonprofit theatre more broadly) falls into these same funding trends. According to the National Center for Charitable Statistics, there are 165 active nonprofit theatre companies in Los Angeles County. These theatre nonprofits received about $43 million in contributed revenue (private and government) in 2013.

The largest two theaters, Center Theatre Group and Geffen Playhouse, (the top 1% by budget size) received approximately $21 million, which is almost half of all theatre funding for Los Angeles County (48.8%).

Without a lot more time, research, and resources, we can’t tell how this definitively breaks out for all L.A. nonprofit theaters. But since this number falls pretty squarely in line with Holly Sidford’s analysis, we can use her data to estimate the rough breakdowns of funding for L.A. theaters by budget size.

Let’s assume that the L.A. theatre scene is fairly analagous to the national arts funding situation. We can estimate that the bottom half of L.A. theaters by budget size receive roughly 5% of all L.A. theatre funding, which comes to about $2.15 million. Let’s put that into perspective:

The two largest theaters received almost ten times the amount of funding received by 83 small theaters which make up half of the L.A. theatre scene.

I’ll be the first to say that this feels wrong. As wonderful and spectacular the work of Center Theatre Group and Geffen Playhouse surely is — I can’t imagine that those two theaters produce the same amount of impact as the equivalent of 830 small theaters. Two theaters do not half a scene make.

A Perfectly Equitable Sector

or the French Revolution Plan

What if it didn’t have to be this way. Let’s imagine a more equitable L.A. theatre community. What if the bottom half of L.A. theaters received half of the funding? That would mean an increase of funding to small L.A. theaters of about $19.3 million, or roughly $233k per theater.

Let’s estimate that the average actor for a qualifying production needs 80 hours of rehearsal and 50 hours of performance, which would be approximately a month-long run (assuming 4 performances/week). To pay that actor a minimum wage of $9/hour would cost roughly $1,000 more than current rules dictate (subtracting the $7–15/performance stipend).

That means if the L.A. Theatre scene was perfectly equitable, we could pay for approximately 233 additional acting roles per theatre company.

That would mean a single small theatre company could produce almost 80 productions over the course of a year (assuming an average range of 1–5 actors/production). Now that’s probably not realistic as that would mean you’d be opening a new show every other week, and have them run in repertory in several different performance venues. What’s more likely to happen if funding was equitably distributed is that there would be an explosion in the amount of theatre being produced. If $2.15 million has been able to support 83 small theaters,

an extra $19.3 million a year could hypothetically support almost nine times that number, or about 745 small theaters.

The exact numbers get a little more murky since we’ll have to account for overhead, available space, paying everyone in these new theaters a minimum wage, and marginal costs…. but you get my drift. We could afford a shit ton more actors. In fact, that’s almost 20,000 acting gigs.

And the thing I want to stress here is that we’re not talking about imaginary new money. I can’t stand “a rising tide raises all boats” arguments because raising a tide is largely beyond human control (except when it isn’t #climatechange #sadface) — but this is money that’s already been set aside for the L.A. theatre economy.

A Progressive Approach

or The New Deal Plan

“What are you talking about?! We can’t redistribute wealth like that. What are we… Bolsheviks?!”

I can already hear the naysayers. While the irony of nonprofit theaters complaining about wealth redistribution is not lost on me (in fact, isn’t that what charitable giving is — a redistribution of wealth?), I understand that a more moderate solution might be more palatable.

What if the bottom half increased from 5% to 20% of funding. That would mean the bottom half would still get a sizable increase of $6.4 million/year. Broken out per theatre, that would be $77k per year, or 77 acting roles, or 25 productions. You could run two shows in rep for every month. Or, again, if cramming all those productions into the existing 83 small theaters isn’t feasible, $6.4 million a year could still support over 240 small L.A. theaters.

In this model, we still have enough cushion at the top to support a progressive curve in organization size. We’ll still have the big splashy musicals and high production values at the top, but we’ll still be able to support a vibrant and bustling small theater scene. And more than that,

this is what a healthier and more resilient theatre economy looks like.

In the old model, we were gambling the vast majority of the L.A. theatre scene’s capital on the returns of just two theaters. Ostensibly, that means more conservative choices and less risk taking. If a production at the top fails, the repercussions are exponentially larger than at a small theater.

In the new model, we would have hundreds of small theatres able to take more risks. Sure not everything that’s being produced will be a success, but we will be able to experiment more with content, pricing, and business models. And more so than that, an investment at the bottom will allow for more voices to enter the L.A. theatre scene. In the same way that Netflix has made it possible for more niche television programming to be viable, and how the surge in small niche fashion start-ups has resulted in the creation of clothing for gender fluid, queer, and trans* and gender non-conforming people

a more equitable L.A. theatre scene will mean that voices and perspectives once marginalized by market forces will be able to have a stage of one’s own.

The Pragmatic Compromise

or the Obamacare Plan

“But Jason, we don’t need more theatre, we just want to support the theatre we’re making right now”

I get it, we can’t all be idealists. We have to be rooted in reality. So how much would it actually cost to pay actors in small L.A. theaters a minimum wage?

So, we have 83 small theaters on the bottom half. Let’s assume each of those theaters produces an average range of 1–3 productions/year. If each of those productions use an average range of 3–7 actors, and each of those actors need to be paid about $1,000 more than the small theaters say that they can afford… that comes out to roughly $830,000. That sounds pretty reasonable.

That means if small theaters in L.A. received just 7% of L.A. theatre funding (that’s just a 2% shift!), small theaters could theoretically pay all their actors a minimum wage.

What’s particularly notable is that this shift of 2% would likely have a largely negligible impact at the top, but would be represent seismic shift for the small theaters. This change would have transformative direct impact for the thousands of theatremakers in this community who are already struggling to make ends meet.

Moreover, it’s feasible that this funding shift could ostensibly come from a single funder who re-evaluates its giving priorities. The Irvine Foundation (one of the largest arts funders in California), for instance, gave a total of $16.1 million in grants to the arts in 2013. The estimated cost of minimum wages for actors would only represent 4% of their annual arts funding.

The Caveats

  1. The L.A. Theatre scene is larger than nonprofit theatre.
    These numbers and estimations are working with an incomplete picture. There are a number of small theatre groups and projects that operate outside of the nonprofit theatre model. That includes commercial theatre, for-profit small theater producers, fiscally sponsored projects (Fractured Atlas alone has over 450 fiscally sponsored theatre projects in California). But these estimates also show us that the challenge of paying actors a minimum wage while keeping the theatres that employ them viable is not impossible — but only if we address the core issue at hand.
  2. These are fast and dirty estimates.
    I by no means claim that these numbers are incontrovertible facts. But as I’ve learned through my time with Fractured Atlas, knowledge is squishy. What I mean by this is that it is very rare that one has 100% certainty about anything. When you get in an elevator, you’re not 100% certain that the cable won’t snap, but you make a decision based on evidence, past experience, and informed estimates. These numbers probably aren’t 100% accurate, in fact I’m pretty sure they’re not. But I’m also sure that we don’t need them to be to make informed decisions about them. That being said, if someone wants us to take a deeper dive into this question, and has the money to fund it… this is totally something we do.

How do we get there?

I don’t have the solution. I have many. Many possible solutions.

A term we use at Fractured Atlas a lot is “directionally correct.” It’s related to the saying, “Don’t let perfection be the enemy of progress,” but a lot more liberating. It’s okay not to have all the answers, but that doesn’t mean you can’t move towards your aspirational goal in small steps.

There is seldom a problem that can only be solved with one strategy or by a lone actor. Usually it takes a confluence of many inputs to generate the outcome we desire. For better or worse, here are

5 Directionally Correct Things We Can Do for A More Equitable L.A. Theatre Scene:
  1. Stop the infighting.
    For the past few weeks, my facebook feed has been trench warfare between theatre producers and actors, lobbing hashtags like grenades and dropping personal attacks like mustard gas. Believe it or not, we’re actually on the same side. In fact, 99% of the L.A. nonprofit theatre scene is essentially on the same side. A more equitably funded theatre benefits just about everyone.
  2. Make a commitment and be accountable.
    The first thing that theatre producers must do to bury the hatchet with actors is be transparent and accountable — and not just about your costs, but also your aspirations and your challenges. The reason why collective bargaining in a union is so necessary for actors is because of the inherent power differential between producer and performer. There are several great initiatives modeling this kind of transparent accountability between gatekeepers and artists. Two that readily come to mind are Working Artist and the Greater Economy (W.A.G.E.) and Flux Theatre Ensemble’s Open Book initiative.
  3. Don’t Be Afraid to Bite the Hand That Feeds You.
    There’s no denying that part of the reason why we’re in this mess is because of the way the philanthropic system operates. Funders are part of the problem, and therefore they will need to be part of the solution. Foundations are conservative in their nature. For the most part, funders both private and public like to fund known entities, big winners, and assured returns. This favors large institutions and causes the money to migrate into a few large buckets at the top. But in the same way producers and artists must be transparent and accountible to each other, so must funders and their communities. That has historically been challenging for arts organizations, who fear losing out on already shrinking funds. But, if the L.A. theatre community can unite behind a common mandate, funders will be more willing to cooperate as partners as opposed to implicit overlords.
  4. Artistic Excellence Should Never Trump Artistic Ethics.
    One of the main reasons why the 99 Seat Plan, and Actors Equity more broadly, exists is because some theatre producers were indeed exploitative. In fact, the reason that artist wages have been so depressed historically is that a culture of constant cost externalization has become matter of fact in the field. If your theatre can’t afford to pay all your actors a minimum wage, then maybe you shouldn’t be doing a show with so many actors. If you can’t ethically produce a play, don’t produce that play.
  5. Share the Risk. Share the Reward.
    Instead of the traditional employer-employee relationship with regard to wages, consider assigning a fixed percentage of earnings to artist and producer pay. As a show is more financially successful, the more artists are compensated. Conversely, should a production fail to make profits, everyone walks away with the same base stipend.

Not all of these ideas will work, and there are definitely many more and better ideas out there about how to achieve this goal. But what’s important to remember is that the problem of fair wages for actors is both systemic and solvable. We can figure this out, but only if we work together.


A Preemptive Defense

I know that many reading this will disagree with the suggestion that the L.A. theatre scene should be more equitably funded. Anticipating some of the rebuttal arguments, I thought I’d offer some context for the naysayers:

“The top 1% deserve more funding because they serve a larger audience and make more impact.”

In 2013, Center Theatre Group reported selling 494,206 tickets. If we had to estimate the audience size of the small L.A. theatre scene it would sit somewhere around 200,000 tickets in aggregate. I’m assuming each small theater produces an average of 3 productions/year, sells an average of 50% of their seats, and has an average 16 performances/production. So yes, according to my estimate, Center Theatre Group does sell more tickets than the small theatre scene.

But does giving at the top really produce economies of scale? Since we know how many tickets Center Theatre Group sold and how much they received in contributed income, it’s an easy calculation to see how efficiently contributed dollars are spent per attendee. In 2013 they spent $33.34/theatregoer. However, the same calculation for the small theaters reveals that small theatres spent an estimated $10.79 of contributed revenue per theatregoer.

If we assume that all theatregoers are created equal, that means a dollar of contributed revenue at the bottom is almost three times as efficient as a dollar at the top.

What would happen if we funded small theaters at the same dollar/theatregoer rate we’re funding the top theatre? That would mean the small theatres would receive about $6.6 million, also known as “The Progressive Approach” which I outlined above… you know the one where small theaters got 20% of L.A. theatre funding.

“Institutional funders are not to blame for the inequitable funding. Individual giving makes up the majority of charitable giving.”

It’s true that most of the funds we’re looking at are mostly coming from wealthy individual donors (individual giving represents about 1.5 times more funding than institutional funders according to American for the Arts). It’s not surprising that the giving of the elite would be distributed in an elitist fashion. However, institutional funders have a self-imposed obligation to benefit the public. Therefore foundations have that greater moral imperative to promote equity in the field by providing more funds to small theaters in order to counteract the concentration of wealthy donors at the top.

Additionally, it should also be noted that given recent initiatives around diversity/inclusion and racial equity in the arts among arts funders, giving priorities that favor a more equitable distribution of funds by budget size will also move the needle on providing more funds to arts organizations serving communities of color, which tend to have smaller budgets in general.

“The large theaters deserve more funding because they are producing at a higher level of artistic quality.”

I’m going to skip over the, frankly offensive, presumption that bigger = better because a lot of the discussion of artistic quality is highly subjective. But I would like to point out that the 99 Seat Plan is addressing the labor of union actors, not just any Schmo off the street with no training (I’ll table my rant on the false distinction between amateur and professional artists for later). Are some union actors better than others? Sure… but admittance into the union would suggest a general equivalence in artistic product. While a small theater obviously won’t have the same production value, they’re both hiring union actors. Therefore, it would be reasonable to believe the caliber of acting is comparable.


Jason Tseng is a Community Engagement Specialist at Fractured Atlas, a nonprofit technology company that helps artists with the business aspects of their work. To learn more about Fractured Atlas, or to get involved, visit us here.