Investing in the arts and culture produces more significant economic returns than just about any investment President Obama is making in "shovel ready" projects. Or many other "bailouts" we might see around the country and across the globe.
Valerio de Molli, Managing Partner of the consulting firm, European House-Ambrosetti presented a surprising study recently at Florens 2010, an international conference on the economy, arts and culture held in Florence, Italy. The startling conclusion: every $100 invested in the arts and culture produces a further $2.49 in GDP growth! And for every three jobs created in the arts and culture, another two jobs are created in the private sector.
The yearlong, in-depth research effort lead examined some 95 key economic performance indicators across eight benchmark countries (Italy, France, Germany, Spain, Greece, the UK, Japan and the US). It is important to keep in mind that the data and their economic implications seemed to play out regardless of geography.
Hello out there! Anybody in government listening?
Robert Dilenschneider chaired a powerful panel that included Laurent Fabius, former French Prime Minister, Terry Garcia, EVP of the National Geographic Society, and Richard Wheeler of the UK's National Trust. Delegates from world class museums, performing arts centers, national parks, world heritage sites, and major municipalities from around the world, all bore the same message: not only do our arts and culture preserve and promote deeper aspects of who we are as people, they too represent cornerstones of our economic well being.
When we invest in "shovel ready" projects and other "bailout" programs, we create short term economic impact and improve infrastructure. No argument there. However, many of these are "one and done" projects -- once the road is built or the bridge repaired, the jobs created have a way of vanishing. But at least you can see some short term spike.
As Valerio pointed out, investing in the arts has a longer time horizon of return, averaging in the 3-5 year range before the full economic impact is felt. However, not only are jobs created in the short term but roughly 50% of the aforementioned 2.49 GDP growth derives from long term, continuing "stimulus" in real estate development, construction, employment and manufacturing. Beyond the obvious impacts on tourism which helps everything from local businesses, hotels and restaurants, not to mention tax revenues, whole industries thrive by supplying goods to be sold, services to be delivered, and infrastructures to be maintained.
And keep in mind that striking data point about two private sector jobs being created for every three in the direct service of the arts and culture. I seem to recall hearing something about the need to create more jobs. Hmmm.
As much as we have a tremendous upside potential here, consider this equally impactful finding: reducing investment in the arts and culture produces significant negative impact. In Italy alone, it has been shown that for every 500,000 Euros removed from the budget for the arts and culture, there is a follow on loss of 1.2 million Euros from the economy in terms of GDP, jobs and tax revenues.
So what are the politicians doing over there? Same things politicians do everywhere, apparently: in 2010, the Italian National Parks Fund was cut by 50%. What do you do when you're losing money on a negative investment strategy? Double down, of course! By law, they must cut a further 80% in 2011!
How's that for a political solution? The short term relief of budget dollars saved today will apparently deepen the financial hole and accelerate the slide downhill.
According to the "Florens Index," a composite benchmark indicator coming out of the Florens 2010 study, the US appears to lead the world in investment in the arts and culture across most statistical categories. However, that may be short lived if current trends in philanthropic giving maintain over the current downturn.
According to The Chronicle of Philanthropy, giving dropped 8% in 2009 on the heels of a 17% decline in 2008. Not only did the arts and culture suffer, but even more apparently more direct concerns took a big hit. For example, healthcare philanthropy dropped nearly $1 Billion last year.
These can't be good signs for us on any front, ranging from declining support for the arts themselves to the impact on the economy itself. As we have observed from watching our economies fall apart, it doesn't take much time to cut, but it does take a goodly amount of time and effort to recover.
Perhaps we each can play a role in keeping the arts and culture in the foreground, through a combination of our own giving coupled with our support of politicians who can see that a key element of our future is founded in our past.
I would love to hear from you about your ideas for preserving the arts and our culture.
Please do leave a comment here or drop me an email and let me know your experience.
Russell Bishop is an Educational Psychologist, author, executive coach and management consultant, based in Santa Barbara California. Watch for my new book, Workarounds That Work: How to Conquer Anything That Stands in Your Way at Work, which will be released January 10, 2011 You can find out more about Russell at http://www.workaroundsthatwork.com. You can also download a free chapter of my new book by going to http://www.workaroundsthatwork.com/ and clicking on "Download a free chapter."
Contact Russell by email at: Russell.Bishop (at) workaroundsthatwork(dot)com
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