Report comes out fighting for economic benefits of the arts

Arts and culture make up 0.4% of gross domestic product from a Government investment of less than 0.1%, according to a new report by the Centre for Economics and Business Research (CEBR). Earned income contributes the highest proportion of revenues to the sector, where aggregate turnover in the music, theatre, dance, literature, visual arts and combined arts totalled £12.4bn in 2011, the year on which the research was based – 3.5% less than when the recession first hit in 2008. In the same year the CEBR estimates that the sector contributed £5.9bn of ‘gross value added’ to the economy, a figure which has grown since 2008 as the sector has successfully cut its costs. Arts and culture are found to be responsible for around 110k jobs and said to be making a positive contribution to average household earnings by paying nearly five per cent more than the UK median salary of £26,095. The sector has also helped to support the wider creative industries, which in total are judged to be responsible for generating around 10% of UK GDP. Visitors from abroad who engage in cultural activity are calculated as adding around £850m of tourist spending to the economy.
The report, ‘The contribution of the arts and culture to the national economy’, was co-commissioned by Arts Council England (ACE) and the National Museum Directors' Council to provide an estimate of the macroeconomic contribution of the arts and culture and some of their indirect contributions through ‘spillover’ effects felt in the wider economy. Published ahead of next month’s Government spending review, the CEBR analysis applies a systematic modeling of national statistics using a methodology recognised by leading economists – one which is applied regularly by the Office for National Statistics. The report authors concede that estimating the value of the spillover benefits of the arts and cultural activity was a less scientific process, based on a mixture of qualitative secondary data plus some interviews and survey responses. Among the findings, arts education is found to improve communication and social skills, thereby increasing the chance of young people staying in school beyond the age of 16 and improving the likelihood of them gaining employment . Regeneration through the arts is seen to give a boost to the creative economy, and Liverpool’s year as a European Capital of Culture, which saw the number of creative businesses in the city rise by 8% during that time, is cited as an example. A measure of ‘cultural density’ devised for the project also shows that the arts and culture have a positive correlation with house prices in an area.
ACE Chief Executive, Alan Davey, said that while Government budgets were under pressure it was ‘right to examine all the benefits that investment in arts and culture can bring’ and ACE will now try to capitalise on the strengths the report highlights.