Wednesday, March 18, 2020
The coronavirus has already had a devastating economic impact on America’s nonprofit arts sector—financial losses to date are estimated to be $3.2 billion. Since the first U.S. case was reported on January 20, cancellations and closings have been reported in thousands of communities spanning all 50 states.
In a national survey by Americans for the Arts, 91% of responding arts organizations indicated that they have cancelled one or more events. Many arts organizations have closed their doors for months to come. More than one-third of respondents expect to make reductions in staff; 26% have already reduced their creative workforce. The $3.2 billion figure includes actual revenue losses to date from admissions (ticket sales, subscriptions, memberships), non-admissions income (gift shop sales, sponsorships, contributed income), and unexpected expenditures (new cleaning and disinfecting protocols, adoption of new technologies, cancellation fees). Current indications from the CDC and President Trump suggest that social distancing and other measures could extend through the summer. Given that losses documented in the survey have occurred only in the last two months, Americans for the Arts anticipates additional billions in potential revenue losses for the nonprofit arts and culture field.
These estimates are based on more than 2,000 respondents to an Americans for the Arts nationwide COVID-19 impact survey, and then further extrapolation of those data nationally using IRS data about nonprofit arts and cultural organizations. The survey is ongoing, and these figures will be updated regularly.
Americans for the Arts calls upon Congress to do the following:
- Designate a minimum of $4 billion—to be distributed through the National Endowment for the Arts—to help offset losses in the nonprofit arts industry and expand eligibility through additional federal programs to ensure artists, entrepreneurs, and small businesses in the creative economy can utilize business interruption relief;
- Adopt recommendations to temporarily lift specific federal grantmaking restrictions;
- Ensure that individual artists (and artists who are small businesses) are fully eligible for any individual payments (such as the potential $1,000 per person payments for individuals that is being proposed, as well as any additional payments proposed to small business since so many artists function as small businesses);
- Ensure that our nation’s 120,000 nonprofit arts organizations, most of which are small businesses, are fully eligible for any small business benefits being incorporated in relief funds; and
- Make additional sums available to the artists and art organizations that function in the for-profit arts arena as well. Our federal government Bureau of Economic Analysis estimates that the broader creative sector, combining the nonprofit and for-profit art sectors, has a significant economic activity of $877 billion.
“Americans for the Arts’ research shows that the coronavirus is already having a devastating effect on arts organizations and artists. The nonprofit arts sector is a $166 billion industry and it is suffering. It is critical that this sector be included in federal stimulus funds,” said Americans for the Arts President and CEO Robert L. Lynch. “There will be a measurable economic and social ripple effect that will be felt in every city and town as arts organizations and performances close, leading to further losses for restaurants, bars, parking facilities, hotels, and much more. The economic damage will be in the billions.”
For more information, please visit the Americans for the Arts Coronavirus (COVID-19) Resource and Response Center.