Trump Immigration Plan Could Wreak Havoc on Movies and Animation

The Trump Administration’s recent attempts to limit travel from Muslim-majority has been met with resistance and uproar. While courts litigate the constitutionality of these travel bans, the administration’s newly announced plan to hobble the H-1B visa program by slowing and intensifying the review process has the potential to create even further disruption — all of which could eventually trickle down into your local movie theater.

When it was created nearly thirty years ago, the original intent of the H-1B program was to allow companies to hire international workers after exhausting a search for Americans who possessed the skill sets needed for a particular job. As industries evolved — particularly those requiring technical backgrounds — the perception grew that workers coming in on H-1B visas were taking the place of Americans and potentially being paid less than their American counterparts. Now, the Trump Administration, in its quest to throw a wrench in established labor and foreign policy norms, could run with that perception and remake a large sector of the entertainment industry.

Technology giants such as Amazon, Google, and Apple are among those that notably take advantage of the H-1B visa program to fill their ranks. Running parallel to the tech giants, the entertainment sector embraced and invented new technologies for visual effects, computer animation, video games, and virtual reality, all of which have increased the demand for highly skilled workers from all over the world. These artists and technicians create the characters and worlds in your favorite films, TV shows, and video games and fuel industries that generated over $129 billion dollars in 2016.

One of those artists is James Bennett, a 17-year veteran of the animation industry. A native Australian who is living and working out of San Francisco, Bennett currently runs Zerply, an online service actively connecting international and U.S.-based companies with creative talent on a global scale. Throughout his career, he has worked as a senior animator and pre-visualization artist at various companies, such as MPC, Animal Logic, Weta Digital, ILM, and DreamWorks Animation, on marquee projects such as Iron Man 2, Avatar, and How to Train Your Dragon 2. Having navigated the visa process in five different countries, Bennett has witnessed the challenges by artists in the film industry firsthand and has useful insight into the future of how artists and the industry as a whole will be affected by current trends in immigration.

The Current State of Hiring in VFX

There are hundreds of companies around the globe that handle visual effects, each with its own process for sourcing and hiring talent. Despite differences in size and location, all are subject to the challenges of project-based hiring. “What happens at these places,” Bennett says, “is that a project comes in, and that’s when they start looking at talent.” Compounding the normal issues of talent availability is based on the the additional costs incurred by companies if they decide on a candidate who requires a visa to be able to work in that country. “Companies want to find someone locally first. Why? Simply put, because it’s so much cheaper.”

In the United States, a VFX company seeking an artist for a long-term contract (two years or longer) from an international pool incurs additional costs, which include flights, accommodation, moving costs,b v and the cost of processing the visa. The cost of processing the H-1B visa alone exceeds $7500. All told, a company can be facing expenses of nearly $20,000 before the artist has even sat down to work on a shot. There’s no guarantee that even once salary and benefits are accounted for that the artist will be a good cultural fit for the company or perform the duties required of them, which can be problematic for an inherently collaborative process such as filmmaking.

For an industry that operates on razor thin margins already, an artist has to be exceptionally talented and highly recommended for a company to take that risk.

From the artist side, the bar to qualify as a viable applicant is quite high. Firstly, you cannot be self-taught. “I’ve seen it first hand — people with 10 years of experience and who are crackingly good artists still get knocked back because they do not satisfy the visa qualifications, one of which is a university degree,” Bennett says. “Being talented is not enough if you want to work internationally.”

In addition to a university degree, artists are required to have at least three years of professional experience in the field to which they’re applying. “For example, if you’re going to be brought in as a character designer, you have to be able to demonstrate your ability to actually do character design.” All of these things have to be validated by official documentation (e.g. pay stubs, W2s, 1099s). Also, an artist needs a letter of authorization and recommendation from their previous company, as well as from the company that’s hiring them. Finally, there are only a certain number of H-1B visas allocated within the year, and you have to apply within a specific window of time. “The short version — it’s quite difficult to get into the States,” Bennett says.

How the VFX Industry Deals Now

“When I went from Australia to New Zealand to work at Weta Digital, it was terrific,” says Bennett. “The two countries have a trade agreement, so all I needed was a functioning passport, and I could work in either country without any kind of visa requirement.” Unlike Australia and New Zealand, there are no similar agreements in the U.S., particularly when it comes to VFX and animation workers.

The effect of the current system is that companies are less willing to go through the effort of hiring an international candidate for those longer contracts (2+ years). To circumvent the hassle of the long term visas, many companies resort to short-term contracts. This project-based hiring process creates a workforce that is much more nomadic than in other industries, where workers are forced to follow opportunities and are subsequently let go at the end of the project. Within film, these short-term contracts average around three to eight months in length, while in commercial VFX, they can average just three to five weeks. “It’s rise and fall, very cyclical in nature,” Bennett says.

While the project-based way of doing business helps maintain a company’s bottom line, the unfortunate side effect is a lot more uncertainty for the workforce. It may present a lot more opportunities for artists, but they have to be willing to constantly uproot their lives in search of them.

Companies have begun establishing offices in other countries, often in cities where other VFX companies have set up shop. Larger companies such as Framestore now have offices in London, Montreal, Los Angeles, and New York as a way of not only maintaining a local talent pool that is ostensibly shared between companies, but also as a way to facilitate international hires.

One further advantage to setting up shop in cities like Vancouver or Montreal is the heavy tax incentives put in place by local governments. With tax breaks reaching nearly 30 percent off of every dollar spent, it’s no mystery why so many of these studios have established a presence in those cities. Even in American cities where tax breaks exist, “quite often rebates are dependent upon the percentage of local talent that is hired,” says Bennett.

Looking Ahead

The future for the VFX and animation industries under harsh immigration policies may look drastically different. It’s not just about the ramifications of people not being able to enter the country to work. It’s going to change how people make art.

Thanks to the proliferation of technology that facilitates working from home, the VFX and animation industries have already started gravitating toward remote work, a trend that would no doubt continue. “You could be working from Spain for a company based out of Berlin, working for a client based out of Australia,” Bennett says. “A company doesn’t have to spend the 20 grand up front to set someone up. They’re not restricted to looking at just the talent within a certain geographic area and don’t have to fight against fifty other companies that are trying to find that local talent to secure tax rebates.”

Though these remote artists are no longer subject to the nomadic lifestyle, the downside is that they effectively are freelance independent contract workers, and companies aren’t required to pay benefits beyond financial compensation.

Further, an increase in remote work means an adjustment in what freelance workers can charge. “Let’s say you pick up an amazing modeler from Hungary for example,” offers Bennett, “someone like that will be charging about €160 a day compared to $500-700 an American artist might charge. It’s a difference of rate expectations based on the marketplace of talent.”

In the long term, artists in more expensive areas may find that they are no longer able to demand as high of rates as they once did. And even with incentives, American cities won’t be able to attract the skilled labor in the same way that they have been over the last two decades.

“In the next three to five years, remote workers are going to be far more prevalent merely because companies won’t be able to get people into the country due to the extra restrictions,” Bennett says. For a highly collaborative art form like VFX and animation, artists working together as part of a team is an intrinsic part of the DNA of the industry. There is something unquantifiable about the dynamic of a studio where artists work together in the same shared space compared to working remotely. As studios overcome technology hurdles such as cloud-based pipeline systems and security concerns to protect precious intellectual property, there will be a seismic shift in the composition of distributed artist teams.

“It’s a massive over-simplification to say that foreign workers are taking American jobs,” Bennett says. “The simple fact is that the need for content is only increasing. Distribution platforms such as Netflix or Hulu, and new outlets like VR, have created a growing demand for creative content. The thing is, someone has to create it. The appetite for high quality content is much larger today because everyone has become accustomed to work being done at a certain level. That expectation has to be filled by experienced, proven creative talent. When you start restricting the access to talent, it causes issues further down the line with regards to content output.”

The intent of changing the rules on the H-1B visas seems to be to force U.S. companies to hire U.S. workers — but that may not be the result. “Those particular visas disproportionately affect higher skilled workers,” Bennett says, “which the U.S. won’t have if they don’t promote the arts or if education programs are eliminated.” Ironically, many of the companies most affected, like tech companies and VFX companies that require highly technical or artistic skills, are already international. “When companies move overseas, the result is a massive brain-drain of local talent. If artists don’t have access to the opportunities, they have to go elsewhere,” Bennett says. “You are not solving a problem by making access to talent harder.”