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Global financial crisis and recession: Impact on the arts

December 15, 200915 December 2009

Impacts of the Recession on the Cultural Sector

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This study is based on a survey of 14 members of the International Federation of Arts Councils and Culture Agencies (IFACCA) in December 2008 and January 2009. Most IFACCA member organizations are national arts councils and ministries of culture.

At the time of the survey, many of these world-wide respondents were “unsure about the extent, nature and timing of the impacts” of the recession. As such, the report “does not claim to provide answers or accurate forecasts about the downturn”. The report also notes that there is “a lack of robust, objective evidence on the economic interdependencies of the arts economy and the effects of previous recessions on the arts”.

Although there was a consensus among respondents that the downturn would have a negative impact on the arts, “there was a notable divergence of opinion and uncertainty about how significant the downturn will be, how long it will last, and the mechanisms by which the downturn will impact the arts”. Given the different economic and political environments in each of the responding countries, there may only be a limited number of commonalities.

One clear expectation is that the drop in asset values would have an impact on endowments and foundations. Business sponsorship was also expected to be strongly affected.

Organizations relying on individuals’ “discretionary” spending might be most severely affected. Tourism spending was expected to be reduced, and there might be a shift to less expensive (or free) arts experiences.

For arts organizations themselves, respondents expected staff layoffs, less commissioning of new work, and possibly less adventurous programming.

Potential positive results could be felt due to “the arts’ ability to provide both a ‘feel-good’ factor and critical and timely debate”. In addition, some arts activities could provide a low-cost alternative to more expensive leisure pursuits.

In the end, the arts sector’s flexibility, creativity and familiarity with limited budgets were thought to be “strengths that will give it resilience under the downturn”.

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