Last week, Sunil Iyengar, Director of Research and Analysis at the National Endowment for the Arts (NEA) was on the NEA’s  Quick Study podcast (transcript) talking about the state of the arts economy for 2021 based on data from the Bureau of Economic Analysis.  While we may all wish to push 2021 out of our memory, there was some interesting data that emerged after the first year plus of Covid, including some hints of decisions and trends here in 2023.

For instance:

Despite all the setbacks for the sector in the past few years, the arts value added in 2021 expanded to a record high of one trillion dollars, over one trillion actually, representing 4.4 percent of GDP, and this growth rate more than doubles that of the US economy.  The economy as a whole grew by 5.9 percent versus 13.7 percent for arts and cultural industries.

The fine print to that is that a significant part of this growth was in category of web streaming and web publishing of arts content which moved to the top position among arts industries by size. Most of this activity was in the commercial rather than non-profit sector. Similarly, most of the categories that either regained or exceeded where they were in 2019 were in the commercial realm including “movies, broadcasting, creative advertising, and arts retail,…” Government run entities like schools, arts and cultural agencies, museums, libraries, cultural exhibits and parks also held relatively steady compared to their 2019 numbers.

Iyengar said the data showed other areas doing better than 2020, but not reaching the levels they were at in 2019.

At the top of that list I’d place a category called independent artists, writers, and performers. So these are establishments led by artists that have at least one employee on payroll. This industry gained from 2020, but at 33.5 billion is still under the 41 billion it contributed to GDP in 2019. Performing arts organizations also have not quite caught up with 2019 levels, though they’re nearly there, as is the case with fine arts schools, and custom architectural services such as woodwork and metal. Then there are a couple of industries that have been in persistent decline since 2020– arts related construction, and grant making services in the arts.

I didn’t know quite what to make of that last bit. Iyengar says these declines are based on economic activity. Given the amount of time it can take to get construction projects set into motion, it wouldn’t surprise me to learn that had not regained momentum after a pause. I am more concerned to think about what it means that grant making in the arts slowed in 2021. My read on that is that granting organizations were pulling back their giving in 2021. Though maybe with arts organizations closing, there were fewer recipients to whom to give?

An interesting observation Iyengar makes later is that while economic activity by self-employed workers is recognized as contributing to the Gross Domestic Product, the data does not distinguish the workers by industry. Iyengar says he suspects a lot of the growth in activity among arts industries is the result of cutting staff and using independent contractors.

“So what that means is I suspect that we’re seeing turbocharged growth for some arts industries even while they’ve lost workers since 2019, and that’s because they’re reverting to contractors such as self-employed artists and other workers who are not counted in the total employment figures here. So that might be why the total employment numbers are lower but we see economic growth still continuing.”