HOW THE ENGLISH ARE WINNING BY INVESTING IN CULTURE
In Great Britain, the Arts Council invests public money in culture on behalf of the taxpayer, so they have a responsibility to demonstrate the value of that investment. It was with this in mind that Arts Council England first asked the Centre for Economics and Business Research (СEBR) to take a hard look at the economic effects of investment in art and culture. The result was an eye opening report, showing how the nation as a whole benefitted from a modest amount of public investment.
In that first, 2013 report, the CEBR found that based on figures for 2011, the arts and culture sector had a turnover of £12.4 billion. This updated version of the report shows that figure has swelled to £15.1 billion based on 2013 figures, growing by nearly a quarter in three years.
Arts and culture incubates the talent for the wider creative sector, which provides more than one in 20 jobs in the UK. So this growth is good news for the future of the creative sector as a whole, and for the national economy.
If you look at the figures for art and culture in terms of Gross Value Added (GVA), which is the net benefit once the external cost has been stripped out, there’s also pleasing progress – a buoyant 35.8% increase between 2010 and 2013 to a respectable £7.7billion.
And it’s progress that is benefitting the workers in the sector. The new report reveals the average arts and culture worker is paid well over the national average, at nearly £28,000. That wage rose 2.4 percent between 2010 and 2013, against a backdrop of relatively low inflation.
Employment is strong in the sector too. This report shows a four percent increase in the numbers of those employed, from 123,000 to 128,000 between 2010 and 2013. The kinds of skills learned in the arts feed the expanding need of a jobs market in which ‘traditional occupations’ are being replaced by a more knowledge and skills based economy. The growth of the sector will be of particular interest to young people entering into the jobs market.
Given the role that public investment plays in developing the arts, we have to look at the details and ask how the taxpayers are benefitting from these new jobs; are they getting value for money?
Again, the news is good. GVA per full time equivalent job –this means the value added to the economy by the average job – stands at £58,000 a year compared with the UK average of £39,500 over the 2009- 13 period.
Labour productivity over the period 2009-13 in arts and culture looks like a real strength, especially in areas such as book publishing, sound recording and music publishing, which record an average of £85,000 – more than double the UK average. If this is narrowed down to just sound recording and music publishing and factor in the latest 2013 figures, you get £130,800 GVA per full time job equivalent. This is Premier League stuff. Even support staff are generating £105,700.
Overall, the arts and culture sector is more than paying its way in the returns it brings to the Treasury. Every pound of public funding going to the Arts Council’s national portfolio organisations pays back £5 in tax contributions from the sector as a whole. The most recent figures show an annual return of £2.35 billion to the Treasury.
The new report also estimates that tourism contributed close to a billion pounds per annum to the arts and culture economy, a significant increase on the previous available figures of £860million.
While it’s a fact that London’s extraordinary combination of cultural attractions and its position as a tourist gateway gives it advantages in attracting visitors and audiences all year round, we are seeing growth in the regions too. This report finds that the contribution to regional economies of arts and culture is growing in the East of England and the East Midlands - at more than the average rate for the UK as a whole. And, whereas this growth is now slowing in London, it is gathering momentum in these areas.
This economic impetus is keenly appreciated in some of the regions of England that have been slow to recover from the recession. In the North East, the arts and culture sector has almost recovered to prerecession levels of contribution to the regional economy.
These figures may be modest compared to bigger sectors of the economy: but they show that the arts and culture sector has a sustainable and growing economic success story. The report not only justifies the faith shown by current levels of public investment. It offers a vision of what more could be done.
The report also contains some data that is of particular significance. For every £1 of turnover art and culture generates, 51p of GVA is added to the economy. That is up by 4p per £1 since the last report. What does this mean? Well, it shows that the arts and culture sector have successfully cut costs, increasing their GVA, and are thereby making a greater contribution to the UK’s GDP. It tells a story of resilience and efficiency, and how the sector has, without losing its creative ambition, succeeded in making more productive use of public funds.
CEBR’s positive findings confirm the results of other recent reports, including the most recent on the Economic Impact of Museums is England, published in March, which found that british museums contributed £1.45 billion of economic output to the national economy.
Seen in this context, public investment in art and culture is a winner. The sector grows each year, yet costs Great Britain less and is more productive. And among its products are those most precious to all of us - entertainment, inspiration, happiness and wellbeing.
Find out more about the research on the effectiveness of investment in culture