Arts in Philadelphia Economy: A Pretty Picture
Cultural groups generate billions for the region, says an economic-impact study being released Monday.
September 24, 2012
Stephan Salisbury, Philadelphia Inquirer
Arts and cultural organizations have a multibillion-dollar impact on the Philadelphia region's economy, and are among the nation's most productive in creation of jobs and stirring up economic activity. Only those in the Washington area generate more per-capita expenditures, and in terms of jobs, no region comes close to Southeastern Pennsylvania.
Cultural activity generates nearly $170 million in state and local taxes annually and supports 44,000 jobs within the city and its four suburban Pennsylvania counties, according to a study set for release Monday by the Greater Philadelphia Cultural Alliance.
The economic-impact study, based on data collected from 345 arts and cultural organizations and more than 2,000 audience members, reports that the sector triggers a total of $3.3 billion in direct and indirect expenditures every year.
In the area of employment, culture in the first-ranked Philadelphia region supports 43,700 jobs; Greater Houston, number two, generates 29,100, and Washington, number three, 29,000.
(New York City is not included in the report because officials there said that, given the size and complexity of their region, the cost of gathering data is too high to allow participation.)
Arts and cultural organizations are responsible for $1.04 billion in household paychecks distributed in the Philadelphia region. The city produces $490.3 million in household income; the four suburban counties (Bucks, Chester, Delaware, and Montgomery) produce $349.5 million.
Tom Kaiden, president of the cultural alliance, said the report demonstrates that the "arts and culture [sector] is a vital regional asset that supports thousands of jobs, benefits business in every industry, and helps grow our economy."
Gary Steuer, the city's chief cultural officer, said the numbers were impressive.
"We need to be invested more in the sector," he said, speaking of government dollars. "Investment in the culture sector is investment that's returned back to citizens and back to the treasury." It is, he said, "a real economic-development investment."
(In 2007, the cultural alliance released its first economic-impact study, which showed comparable, although smaller, figures. But alliance officials said the two reports are difficult to compare because the most recent draws on much more data and uses slightly different economic modeling.)
Currently, the city provides direct subsidies for a handful of institutions, including the Philadelphia Museum of Art, the African American Museum in Philadelphia, and the just-reopened Philadelphia History Museum. It also provides for the city's Cultural Fund, currently a $1.8 million pool of grant money for city organizations.
Institutional subsidies and the cultural fund have all taken a hit since the 2008 fiscal crisis and subsequent recession, although the most recent city budget maintained level funding compared with last year. Similarly, the state has cut support for cultural and arts organizations substantially in recent years, but has maintained reduced levels of arts funding the last two years.
Philip R. Hopkins, research vice president for Select Greater Philadelphia, the economic development arm of the Greater Philadelphia Chamber of Commerce, said the numbers tell only part of the story.
Arts and culture are "very much a significant contributor to quality of life," said Hopkins, who had not seen the cultural alliance report. "That's important for corporations. It's important for workers. It's very much an enabler of economic development.
"The importance of arts and culture . . . is greater than the percent contribution to the economy," he continued. "It's important in so many ways."
That view is shared by Paul Flora, a senior economic analyst with the Federal Reserve Bank of Philadelphia. Flora, who also had not read the report, pointed out that the broader region - stretching from Philadelphia to South Jersey to Wilmington - has a combined gross output of about $346.9 billion. That would put the arts sector at around 1 percent of the smaller Southeastern Pennsylvania area, he said.
"But the arts represent a large value beyond the ticket," he continued, providing a regional identity that attracts and anchors businesses, serves the university world, and supports educational activities in communities across economic and regional boundaries, he maintained.
"It's a crucial part of our economy - crucial in attracting people," Flora said.
Steven T. Wray, executive director of the Economy League of Greater Philadelphia, which has worked with the cultural alliance in the past, said that arts and cultural organizations represent "a class of regional assets that are part of authentic greater Philadelphia - parks, arts, libraries, open space, waterways. The challenge is how we continue to support them."
Contact Stephan Salisbury at 215-854-5594, [email protected], or @SPSalisbury on Twitter