Arts and the Economy

The $2.2 billion difference

Every so often, someone makes the point that culture isn't just good for the soul, it's good for the economy too. All those dollars expended on music concerts, art museum visits, stage shows, and whatnot have a hardcore impact on the fiscal health of a community/state/country. Five years ago, the Perryman Group, headed by Waco economist M. Ray Perryman, released a pretty eye-opening report titled "The Arts, Culture, and the Texas Economy," which noted that, at the time, direct spending on the arts in Texas totaled almost $22.1 billion annually and that for every dollar spent on nonprofit arts activities, "more than $298 of cultural impact on the economy occurs, as well as $9.20 in state revenues."

So much for the state. Now, the city: For about five years, TXP, a local consulting firm dealing in economic analysis and public policy, has been studying up on the role of the cultural sector in the Austin economy. In earlier studies, it zeroed in on specific corners of Austin's arts community: the music scene (2001), the nonprofit arts scene (2003), and the film scene (2004). Now, it's updated those reports and tied them together in one pretty package. The upshot? The cultural sector contributes over $2.2 billion to our economy and $48 million to local tax revenues annually and is responsible for close to 44,000 permanent jobs. As the Perryman report did, TXP argues this impact is just the tip of the iceberg, since the arts make such a crucial contribution to a city's quality of life, which attracts more business, which boosts the economy still further. (It's the "creative class" argument popularized by Richard Florida, who's quoted more than once in TXP's report.) The bottom line? The arts are key to the city's overall appeal and fiscal well-being, and we'd best keep supporting 'em or else: "Communities with vision see the arts and related sectors with this 'wide-angle' lens," says TXP. "Those that take a narrower view may do so at their own peril." The report will be incorporated into the Austin Community Cultural Plan process currently under way in the city's Economic Growth and Redevelopment Services Office. "Maybe this will help other sectors that help drive the economy recognize and support the arts and cultural sector more," says Cultural Arts Program Manager Vincent Kitch. After all, during the downturn, when other industries collapsed, "film and music kept chugging away, were growing, and continued to build." For more information, visit

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Perryman Group, M. Ray Perryman, The Arts, Culture, and the Texas Economy, TXP, Inc., Richard Florida, Austin Community Cultural Plan, City of Austin Economic Growth and Redevelopment Services Office, Vincent Kitch

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