Saturday, April 30, 2016

2016 National Arts Index

Good morning.
"And the beat goes on…………….."

I have had a number of posts ready to go, and have been meaning to get them up, but I've been in the process of moving / relocating for the past several weeks.  I apologize for the delay.  I hope to get several of them up in the next couple of weeks, starting with this one.

The 2016 (and final) National Arts index:

This month, Americans for the Arts published the “2016 National Arts Index,” its annual measure of the health and vitality of arts in the U.S.  In 2010, we published a summary of the first Index report here on my blog.  As this is the final National Arts Index report, concluding the 10-year initiative, we thought it appropriate to ask Randy Cohen to again share some of its findings and learnings:

What’s Treasured is Measured!
We have all long been in the hunt for more arts data, better data, data that demonstrates value and impact, and data that helps us track and make sense of trends. In 1967, three years before he wrote Future Shock, futurist Alvin Toffler penned an entire paper about this: “The Art of Measuring the Arts.” In it he writes, “A cultural data system is needed to provide information for rational policy-making in the cultural field and to assist those outside the field in understanding their impact on it.”

National Arts Index
The National Arts Index is an attempt at creating such a system, using as wide of a lens as possible—nonprofit, for-profit, artists, financial flows, evolving public participation, competitiveness of the sector—81 national-level indicators produced annually by the federal government, commercial data providers, and private research organizations. It is set to a base score of 100 in 2003; every point difference is a one-percent change. The National Arts Index summary score of 99.8 in 2013 is just a fraction below the 2003 Index baseline of 100.

While the Index score is composed of 81 indicators, it is the stories that emerge from these individual indicators that have proved most fascinating:

Arts Track the Economy
This year’s report provides the fullest picture yet of the impact of the Great Recession on the arts—before, during, and after.  Like many sectors of the economy, the arts recovered slowly and unevenly from the recession due to industry contraction and consolidation, the impact of technology, slow rebounds in philanthropy, and tepid consumer spending.  While some indicators may be up during a recession, we see that a majority of them we were in decline. The arts were a little slower to fully bounce back than the economy at large.

  • During the economically robust years of 2002-06, more than 50 percent of the indicators increased annually.
  • Between 2007 and 2009, however, less than one-third of the indicators increased.
  • In a key sign of continued improvement, more than half (55 percent) of the indicators increased in 2013.

Artist Employment

  • The number of working artists grew between 2002 and 2013 (2.10 to 2.22 million). Artists remain a steady 1.5 percent of the total civilian workforce.
  • The self‐employed “artist‐entrepreneur”—active as poet, painter, musician, dancer, actor, and in many other artistic disciplines—is alive and well, with numbers growing steadily between 2002 and 2013 (554,000 to 766,000).

Arts Education

  • Between 1998 and 2009, the percentage of college-bound seniors with four years of arts or music grew from 15 percent to over 20 percent. Since 2009, however, the share of SAT test-takers bringing this credential to their college application process slid, suggesting that pervasive arts education cuts in the 2000s had the downstream effect that was long a concern. In 2013, this arts educated population was about 18 percent of all SAT test takers.  
  • Demand for college arts degrees continues to increase. Even with downward trends in the number of high school arts and music classes taken by college-bound seniors, college-level demand in this area continues to increase. The number of college arts degrees rose steadily from 75,000 to 139,000 between 1997 and 2013. Reasons for this include an increase in design degrees along with the appeal to college students of double-majors combining arts with humanities, social sciences, and physical sciences. This is promising news for business leaders looking for an educated and creative workforce.
  • Similarly, the percentage of SAT test takers who indicate an intention to major in the arts grew from 6.5 percent to nearly 8 percent between 2004 and 2013.

Financial Challenges
The number of nonprofit arts organizations has grown rapidly over the decades (currently about 95,000 organizations)—evidence of entrepreneurship in the arts. (Between 2000 and 2011, a new nonprofit arts organization was created every three hours in the U.S.)  Yet, the sector has struggled financially throughout that time period. The percentage of nonprofit arts organizations filing an IRS 990 with a deficit has ranged from 36 percent in 2007 (during a strong economy) to 45 percent in 2009 (the deepest part of the recession).

  • In 2013, a time of improved economic health, 42 percent of arts nonprofits still failed to generate positive net income—a figure that raises concerns about the long-term sustainability of arts organizations that are unable to achieve a break-even budget.
  • While some of these organizations have reserves available and other deficits may be the result of federal accounting and tax filing requirements, it is clear that the budget fortunes of nonprofit arts organizations got worse during the Great Recession and are slow to recover.

Technology is changing audience engagement
The effects of technology have been undeniably swift, but it depends where one sits on the arts production-to-consumption food chain as to who the winners and losers are.

  • Since 2003, half of the nation’s CD and record stores have disappeared. The public, however, has hardly stopped listening to music. Digital downloads of singles grew from 139 million units to 1.33 billion between 2004 and 2013. Annual data about downloads was not even collected until 2004, yet in 2013 it accounted for 37 percent of total music industry sales. Streaming providers like Pandora and Spotify represent an additional 27 percent of recording revenues.
  • Similarly, bookseller revenues fell even while the number of books in print grew, thanks to more self-publishing, print on demand, eBooks, and downward pressure on prices.
  • Savvy nonprofit arts organizations are using technology to broaden their audience base and enrich the audience experience, like the successful Metropolitan Opera simulcasts (2,000 theaters in 66 countries and 3 million tickets sold annually).

Arts Engagement is Fluid
How the public participates in and consumes the arts is ever-expanding thanks to advances in technology and a public seeking more active engagement in their arts choices. The data indicate that people are not walking away from the arts, but they are finding alternatives to some of the traditional delivery mechanisms—downloading music instead of buying a CD from a retail store, or watching an opera simulcast at the cinema instead of live in the opera house.

  • In 2013, 31 percent of the adult population attended a live performing arts event—a long and steady drop from 40 percent in 2003.
  • Art museum attendance also continues a slow decline, with 12.9 percent of the population attending at least once in 2013, which is down from 15.5 percent in 2003.
  • On the other hand, Americans continue their personal involvement in the arts as maker and creator (Chorus America tell us there are 250,000 choirs in the U.S. with 32 million people singing in them), by increasing their arts volunteerism, and receiving more college arts degrees.
  • Almost certainly related is the decreasing share of households making contributions to the arts—a figure that dropped annually between 2007 and 2012, from 9.3 percent to 8.2 percent, before showing a fractional uptick to 8.3 percent in 2013.

Arts Volunteerism
Two Index measures show the range of volunteer engagement in the arts.

  • Volunteering at an arts organization was the choice of service for over 2.2 million people in 2013, up 16 percent from 1.8 million in 2010.
  • In another federal study of volunteerism, 5.7 million Americans say that arts activities (such as playing music) are their main activities while volunteering, regardless of type of organization they volunteered for (a school or church, for example).

Arts Organizations Foster Creativity Through New Work

  • Year after year, entrepreneurial arts organizations nurture new ideas, innovative leaders, and creative energy. Between 2002 and 2013, audiences were treated to more than 11,500 new works—over 150 new operas, 1,446 orchestral works, 3,054 plays, and almost 6,500 movies.
  • Regardless of the economic cycles, America’s arts industries continued to produce new and exciting work for their audiences.

Prospects are good for the arts
Since 2002, there are two indicators that help explain the health of the arts sector: total charitable giving and overall employment. These two factors explained a substantial 72 percent of the change in the Index value between 1999 and 2013. This makes sense, of course. People who are working, especially within the confidence of a growing job market, have more discretionary income to engage in the arts both personally and as consumers, and are also financially more able to make charitable contributions. Thus, the increases in employment and in overall levels of charitable giving in 2014 and 2015 are promising signs for the arts.

The Local Arts Index
The National Arts Index makes it easy to compare time periods for the nation as a whole. The Local Arts Index, on the other hand, provides a narrow time period but a deeper look—down to the county level. Visit the “Where I Live” page of Arts Index website to find tools to help you examine the arts in your community, and begin a dialogue about the character and aspirations of your arts community. Several that I always find interesting are about competitiveness and opportunity for new and emerging arts organizations.

Millennial Index: The Challenge for New Organizations
It is well known that the number of arts nonprofits grew substantially in the 2000s. In the average county, a remarkable 37 percent of nonprofit arts organizations were established since 2000. Yet, they average just 21.7 percent of total arts organization revenues in that county (the median was just 16.3 percent).

  • A mix of new and established arts organizations is one element of the character of a arts community. To what extent does funding favor the older institutions and make a greater uphill climb for the new and emerging?
  • Newer organizations are often highly innovative in their approach to their specific discipline and serve as incubators to test new ideas. If your community embraces these values, is that reflected in local arts funding and policies?

Revenue Concentration: The Challenge for Smaller Organizations
Another way to characterize a community’s nonprofit arts population is to look at the mix of small and large organizations. Some communities have a handful of “major” arts institutions that consume a relatively high share of resources, and get a lot of attention because they produce large-scale, high volume arts activities. The revenue concentration indicator measures the share of total expenditures made by the four largest arts organizations in each county. On average, the top four organizations represent an average of 58 percent of total financial activity in each county.  While the majors probably represent a similar share of the total audiences as the total expenditures, it still begs the question about how much financial opportunity there is for newer and smaller organizations.

You can download the Index reports, read about the methodology, and find county-level index data at Randy Cohen, Americans for the Arts, and Roland Kushner, at Muhlenberg College, are the co-authors of the Arts Index reports.

Have a great week.

Don't Quit.