In July, the Screen Actors Guild – American Federation of Television and Radio Artists (SAG-AFTRA), which represents over 160,000 Hollywood actors, went on strike over decreased residual compensation. Many performers depend on residuals, or continual lifelong payments, to generate a steady income for the remainder of their lives. Depriving them of these payments is detrimental to the acting community because it discourages aspiring entertainers from pursuing supporting roles and puts many actors in difficult financial situations.

SAG-AFTRA’s president, Fran Drescher, said that most actors “are just working people just trying to make a living, just trying to pay their rent, just trying to put food on the table and get their kids off to school… everything that you watch, that you enjoy, that you’re entertained by are scenes filled with people that are not making the big money.” 

Thus, lower residual payments may deter people from entering the acting industry in the first place, consequently harming film production. Actress Sanaa Lathan further revealed the importance of residual payments for developing entertainers: “I think I got my SAG card doing a Secret deodorant commercial. I was able to pay my rent back then for a whole year while I was still a struggling actor going out for auditions. That would never happen today.” Specifically, less residual payment would likely result in fewer applicants for supporting roles, which are essential in any production.

Actors are often unable to work year-round due to the nature of the casting process which is harmful as it prevents actors from qualifying for union benefits. According to a CNN interview with SAG-AFTRA board representative Shaan Sharma, only around 13% of SAG-AFTRA members are eligible for its health coverage plan, which requires an annual salary of over 26,000 dollars.

For many streaming services, residuals given to actors and writers are determined based on the number of a given service’s  subscribers rather than the success of a production. Hence, according to The Washington Post, these studios “are making more off shows because of streaming, while writers and actors… are making less.” 

This transition to payment coming from subscription count rather than the number of episode airings reduces the benefits of residuals because a production’s success does not result in a higher residual for the contributing actors and writers. Many actors feel that residual payments should be increased rather than decreased, and some have reported their residual compensation to be less than a dollar from streaming service reruns. Therefore, streaming services must provide actors with increased residuals so that they can receive substantial compensation for their efforts.