Exploring the Economic Impact of the Arts

We all know works of art can be worth a lot of money.

But what about the process of making that art? Displaying it? Teaching it? Building a business around it?

What's that worth?

As it turns out, quite a bit.

When you combine things like theater, art galleries, film, music festivals and the like into the same basket, the economic impact turns out to be extraordinary.

That's what the members of the Pennsylvania House Democratic Policy Committee discovered Thursday morning when they visited Steel River Playhouse in Pottstown to gather testimony on the economic impact of the arts.

Show Us the Money

For example, the arts generates $4.1 billion in economic activity in just the greater Philadelphia metropolitan area, supports 100,000 jobs in PA and generates $402 million a year for local governments, according to Jenny Hershour, managing director for Citizens for the Arts in Pennsylvania.

Photos by Evan Brandt

From left, Kelley Gibson, Cultural Alliance of York County; 

Jessica Willingham, Valley Forge Tourism and Convention Bureau:

Jenny Hershour, Citizens for the Arts in Pennsylvania.

"The dollar you invest here goes a long way," said Hershour.

Crystal Brewe, senior vice president of strategic marketing and communications for the Kimmel Center for the Arts in Philadelphia couldn't agree more.

She said for every dollar Pennsylvania invested in the creation of the center, it has received a $1.24 in returns.

Nationally, 4.9 million are employed directly or indirectly in the arts and it generations $763 billion nationwide, she said.

In the case of the Kimmel Center, Brewe said after New York City's Lincoln Center, the Kimmel Center for the Arts is "the most impactful art center in the United States."

Arts as Revitalization in Post-Industrial Cities

Steelstacks, Musikfest and ArtsQuest projects in Bethlehem have helped revive that city, which was once synonymous with post-industrial decay, said Karl Blischke, executive director of the Pennsylvania County on the Arts

"Bethlehem is now used as model for post industrial cities. The city now has the third highest concentration of high income millennials in Pennsylvania, after Philadelphia and Pittsburgh," he said.

Musikfest, which was recently voted the best music festival in North America in a USA Today poll, "set the stage for it all. When it first started, nobody knew what is was, but it has grown and gave birth to ArtsQuest, and together they now attract 1.8 million people a year" to Bethlehem, said Blischke.

"Musikfest helped change Bethlehem's brand recognition from a down-on-its-luck steel town, to an arts center where people want to live," he said.

There's now an effort underway to see if something similar can be done in the City of Chester.

Chester Made is a revitalization driver using art and innovation there and it has reached 20,000 people, said Laurie Zierer, executive director of the Pennsylvania Humanities Council. 

Ulysses Slaughter, project manager, highlighted three themes Chester Made lives by, "re-claim, re-purpose, re-build."

"We're now looking to shift from post-industrial economy to an arts economy," he told the panel, adding a priority is ensuring the people who live there benefit. "We say conversations first, paint-brushes, poems and power tools second," he said.

That's an important aspect of using arts to drive revitalization, said Joanna Davis, public art manager for the Lancaster City Office of Public Art.

She said a study by Franklin and Marshall College, located in Lancaster, outlined how art could be used to revitalize the downtown, an effort which has borne numerous successes.

But the city wants to be sure the benefits of that revitalization don't raise real estate prices and price the current residents out of their own neighborhoods, she said.

The next phase is bringing public art, some of it temporary, into the neighborhoods around the downtown and making sure to involve the residents in choosing and designing what comes.

"We don't want art to be something that happens to them," Davis said. "We try to meet them where they live and get them talking about what they would like to see, what they themselves can produce. That's key."

"The question is when the artists come, how do you not gentrify, make the people who are already there feel welcome, and so the artists stay?" said Kelley Gibson, president of the Cultural Alliance of York County.

Arts Impacts in Montgomery County

A little closer to home, Jessica Willingham, director of government and cultural affairs for the Valley Forge Tourism and Convention Board, made clear that the arts is big business in Montgomery County.

There are the direct impacts, like $16.1 million for spending by arts organizations and the indirect impacts like restaurants, shops and services used by arts organizations, which all adds up to a total impact of $32.3 million a year.

Members of House Democratic Policy Committee listen to testimony. 

Then there is the impact of the audiences, $34.8 million for direct impact for things like art or tickets purchased; and the indirect impact like the hotels and restaurants those audiences use while they're here, bringing the audience impact total up to $81 million a year.

Taken together, it adds up to $113.3 million a year, onto which must be added the 1,425 jobs, $32.1 million in household income and $6.3 million in total tax revenue the arts generate in Montgomery County.

For example, Willingham said, 30,000 people a year come to North America's longest running music festival, the Philly Folk Fest. And they all spend money.

Another example of economic impact is the Montgomery County studio tour, she said. This year, 40 artists in 27 studios around the county sold $50,000 worth of art during the one-weekend event.

This is the tour's third year and the total art sold has risen from $40,000 and more artists are asking to participate. "You've got a good cluster of them right here around Pottstown," said Willingham.

"The arts draws tourism," Willingham said.

"And a cultural tourist is much more lucrative than a sports tourist," said   "On average, cultural tourists stay three nights longer than other tourists. They will pick a place where they can experience multiple cultural attractions, generating more economic impact," said Gibson.

If You Market it, They Will Come

More marketing is needed to bring more people and create more economic impact, many of the speakers told the panel.

Charles Croce was the executive director and CEO of the Philadelphia History Museum, until it closed.

"History is Philadelphia's brand," said Coce. But the city has more than 40 historic organizations and museums and they cannot be supported with marketing, or consolidations and mergers.

It's worth the effort because "more Americans go to museums, about 23.7 percent, than go to dance and art venues combined," he said.

Testifying from left are Laurie Zierer, Pennsylvania Humanities
Council: Ulysses Slaughter, Chester Made; Joanna Davis,
Lancaster City Office of Public Art and; Karl Blischke, 

Pennsylvania Council on the Arts

"If you are going to spend money on marketing, bringing in people from out of state will deliver your best return on investment," said Gibson.

But currently, Massachusetts is kicking Pennsylvania's butt, several speakers said.

"Massachusetts spends $11 million on marketing in Pennsylvania, but Pennsylvania spends only $2 million there. Europeans think America was founded in Boston because Massachusetts is spending money telling them that. Pennsylvania spends nothing there," Croce said.

"I see New York advertising in Pennsylvania, I see Virginia and Massachusetts advertising in Pennsylvania, I don't see Pennsylvania advertising in those places," said Hershour.

"I think we miss the boat in Pennsylvania by not marketing arts and culture more broadly," said state Rep. Joe Ciresi, D-146th Dist.

Ciresi, who formerly worked at the Kimmel Center and has performed at Steel River Playhouse, where he was recently named to the board of directors, said "I saw how the Kimmel Center transformed Philadelphia and what Steel River is doing for Pottstown."

Pottstown's Playhouse

Some of Steel River's economic impact in Pottstown was highlighted Thursday by Rita Pedersen, the development director for the theater, now in its 11th season.

Shows at the theater have attracted 10,000 people to downtown Pottstown and it is having an impact that she herself can see. "The things I can do in Pottstown has changed drastically in the last four years," she said.

State Rep. Steve Malagari, D-53rd Dist., is on the committee and he said "I have not been in Pottstown for a long time, and I very impressed with architecture here and I can see businesses set up around Steel River Playhouse."

From left, Charles Croce, Philadelphia History Museum;

Rita Pederson, Steel River Playhouse and: Crystal Brewe,

Kimmel Center for the Performing Arts.

Blischke agreed that Steel River Playhouse is "a great cultural anchor for Pottstown."

Pederson says Steel River has met with High Street business owners, explained to them about arts spending works and  asked them how they could help businesses take advantage of the asset to boost their business.

"We are able to keep our ticket prices reasonable, and we are part of an exciting revitalization of this community," she said, adding "we bring theater to an underserved community." 

It's About More Than Money

Steel River recently staged a performance for 1,000 school children free of charge, thanks to a grant and has scholarships for workshops and summer camps for kids Pederson said. 

Which brings us to the value in the arts that is not all about the money.

State Rep. Danielle Friel Otten, D-155th Dist., said she recently attended a ballet performance by her daughter and was amazed at the sophistication of the subjects they tackled.

"They dealt with the fate of bees, they tackled issues about female body image and gun violence," Friel Otten said. "The arts help people tell stories they can't conceive in any other way."

That's what makes them so important, said Slaughter

"Art is too often looked at in education as what you do after you do everything else," said Slaughter. "Science, math, literature, it's all art. It's about what we prioritize. If we prioritize art, we won't always be trying to recover or save it. We have to make it a funding priority, not an afterthought."

Pederson said Steel River decided to try to support playwrights by asking for submissions of unpublished, un-performed plays. They really hit a hot spot.

"We thought we might get 100, maybe 200. We received more than  800 submissions, and we had to choose six that would get live readings in this space," Pederson said, adding that "we're going to do it again."

How Do We Do More?

One way is to get grants to do more.

In December, the Pennsylvania Council on the Arts will announce the first four communities that will receive grants of $25,000 annually over four years to help drive revitalization through the arts.

Croce recommends adoption of a dedicated state fund for the arts and museums. It would creates stable funding, he said, noting that 1 Raptor jet fighter costs use taxpayers $152 million. Just one. 

The budget for National Endowment for the Arts for the entire United States is $2 million less, at $150 million.

And with that, here are the Tweets from the hearing.

The Work of Art