ECONOMIC IMPACT OF THE ARTS IN MISSOURI

The Arts & Economic Prosperity Studies by Americans for the Arts

Coming in 2017: Arts & Economic Prosperity V

Americans for the Arts, the country’s leading nonprofit organization working for the advancement of all the arts, has since 1992 periodically conducted sweeping nationwide studies measuring the economic impact of spending by nonprofit arts and culture organizations and their audiences.

In addition to the national results, state arts agencies have the opportunity to commission individualized reports for their states.  In 2009, the Missouri Arts Council participated in Arts & Economic Prosperity III. Now we are engaging in Arts & Economic Prosperity V. Research is currently in progress. Americans for the Arts will announce the results on June 16, 2017.

Not only are we conducting a statewide study, but we are joined by local communities conducting the study in Columbia, Hannibal, Joplin, Kansas City, Springfield, St. Joseph, and St. Louis. These partners will receive detailed economic reports for their own regions. Community partners are the Allied Arts Council of St. Joseph, City of Columbia Office of Cultural Affairs, Hannibal Arts Council, Connect2Culture in Joplin, Springfield Regional Arts Council, Regional Arts Commission and Grand Center Arts & Entertainment District in St. Louis, and ArtsKC.

The studies powerfully demonstrate that the nonprofit arts and culture industry is an economic driver in communities—a growth industry that supports jobs, generates government revenue, and stimulates tourism.

Americans for the Arts’ website has published the results of Study IV and Study III. For our Missouri results from Study III, read on for the highlights or download the full Missouri report as a PDF.

Arts & Economic Prosperity III

The Arts & Economic Prosperity® III Study was conducted by Americans for the Arts in 2009 to document the economic impact of the nonprofit arts and culture industry in 156 communities and regions representing all 50 states and the District of Columbia. The diverse communities range in population (four thousand to three million) and type (rural and urban). The study focuses solely on nonprofit arts and culture organizations and their audiences and excludes spending by individual artists and the for-profit arts and entertainment sector (i.e., Broadway or the motion picture industry). Detailed expenditure data was collected from 6,080 arts and culture organizations and 94,478 of their attendees.

How Were the Results Determined?

The project economists, from the Georgia Institute of Technology, customized input/output analysis models for each study region to provide specific and reliable economic impact data. To derive the national estimates, the study regions were layered into six population groups, and an economic impact average was calculated for each group. The nation’s largest 12,662 cities were then assigned to one of the six groups based on their population as supplied by the U.S. Census Bureau. Each city was assigned the economic impact average for its population group, and then all were added together to determine the national economic impact findings. The two largest U.S. cities, New York and Los Angeles, each with more than $1 billion in organizational expenditures, were excluded from this study to avoid inflating the national estimates.

What Does This Mean for Missouri?

This study was done on a national level, so what does this mean for Missouri? Total spending by nonprofit arts and culture organizations and their audiences totaled $1.1 billion in the State of Missouri during 2008. The following table shows the direct economic impact of this spending–that is, the initial economic effect of these expenditures.

Nonprofit arts and culture organizations are active contributors to their business community. They are employers, producers, and consumers. They are members of the chamber of commerce as well as key partners in the marketing and promotion of their cities, regions, and states. Spending by nonprofit arts and culture organizations totaled $510.2 million in the State of Missouri during 2008. This spending is far-reaching: organizations pay employees, purchase supplies, contract for services, and acquire assets within their community. These actions, in turn, support jobs, create household income, and generate revenue to the local and state governments.

DIRECT Economic Impact of the Nonprofit Arts and Culture Industry in the State of Missouri (Spending by Nonprofit Arts and Culture Organizations and Their Audiences)

                          

State of Missouri 

Median of Statewide
Study Regions  

Total Expenditures*

 $1,07 Billion

$418 Million

Full-Time Equivalent Jobs

 14,893

9,190

Resident Household Income

 $315 Million

 $168 Million

Local Government Revenue

 $19.2 Million

$6.27 Million

State Government Revenue

 $29.67 Million

 $17.54 Million

These direct economic impacts create an additional indirect economic impact on the economy. The local expenditures continue to have an economic impact on the economy until the money eventually leaks out of the region (i.e., is spent outside the State of Missouri). The total economic impact is the combination of the direct economic impact and the indirect economic impact. The table below shows the total economic impact of the $1.1 billion spent by nonprofit arts and culture organizations and their audiences during 2008.

TOTAL Economic Impact of the Nonprofit Arts and Culture Industry in the State of Missouri (Spending by Nonprofit Arts and Culture Organizations and Their Audiences)

                          

State of Missouri 

Median of Statewide
Study Regions  

Total Expenditures*

 $1,072,656,998

$418,055,786

Full-Time Equivalent Jobs

 33,617

11,060

Resident Household Income

 $742,875,000

$213,712,000

Local Government Revenue

 $45,014,000

 $18,556,000

State Government Revenue

 $65,542,000

$25,682,000


Direct and Indirect Economic Impact: How a Dollar is Re-Spent in the Economy

Arts & Economic Prosperity III uses a sophisticated economic analysis called input/output analysis to measure economic impact. It is a system of mathematical equations that combines statistical methods and economic theory. Input/output analysis enables economists to track how many times a dollar is re-spent within the local economy, and the economic impact generated by each round of spending. How can a dollar be re-spent?

Consider the following example: A theater company purchases a gallon of paint from the local hardware store for $20, generating the direct economic impact of the expenditure. The hardware store then uses a portion of the aforementioned $20 to pay the sales clerk’s salary; the sales clerk re-spends some of the money for groceries; the grocery store uses some of the money to pay its cashier; the cashier then spends some for the utility bill; and so on.

The subsequent rounds of spending are the indirect economic impacts. Thus, the initial expenditure by the theater company was followed by four additional rounds of spending (by the hardware store, sales clerk, grocery store, and the cashier). The effect of the theater company’s initial expenditure is the direct economic impact. The effects of the subsequent rounds of spending are all of the indirect impacts. The total impact is the sum of the direct and indirect impacts.

Economic Impact of Spending by Nonprofit Arts and Culture ORGANIZATIONS in the State of Missouri

Nonprofit arts and culture organizations are active contributors to their business community. They are employers, producers, and consumers. They are members of the chamber of commerce as well as key partners in the marketing and promotion of their cities, regions, and states. Spending by nonprofit arts and culture organizations totaled $510.2 million in the State of Missouri during 2008. This spending is far-reaching: organizations pay employees, purchase supplies, contract for services, and acquire assets within their community. These actions, in turn, support jobs, create household income, and generate revenue to the local and state governments.

Data were collected from 420 nonprofit arts and culture organizations in the State of Missouri. Each provided detailed budget information about more than 40 expenditure categories for fiscal year 2008 (e.g., labor, payments to local and non-local artists, operations, materials, facilities, and asset acquisition) as well as their total attendance figures. The following tables demonstrate the direct and total impacts of this spending.

DIRECT Economic Impact of Spending by Nonprofit Arts and Culture Organizations in the State of Missouri

                 

 State of Missouri

 Median of Statewide
Study Regions

Total Expenditures*

$510,204,701

$247,127,217

Full-Time Equivalent Jobs

5,320

 4,039

Resident Household Income

 $145,698,000

$89,813,000

Local Government Revenue

 $3,644,000

 $1,888,000

State Government Revenue

 $5,686,000

 $4,166,000


TOTAL
Economic Impact of Spending by Nonprofit Arts and Culture Organizations in the State of Missouri

State of Missouri  

 Median of Statewide
Study Regions

Total Expenditures*

$510,204,701

 $247,127,217

Full-Time Equivalent Jobs

19,690

5,163

Resident Household Income

$413,237,000

 $119,603,000

Local Government Revenue

 $16,555,000

 $2,694,000

State Government Revenue

$23,231,000

$5,896,000


Economic Impact of Spending by Nonprofit Arts and Culture AUDIENCES in the State of Missouri

The nonprofit arts and culture, unlike most industries, leverage a significant amount of event-related spending by its audiences. For example, when patrons attend an arts event, they may pay to park their car in garage, purchase dinner at a restaurant, eat dessert after the show, and pay a babysitter upon their return home. This spending generates related commerce for local businesses such as restaurants, parking garages, hotels, and retail stores.

To measure the impact of nonprofit arts and culture audiences in the State of Missouri, data were collected from 3,119 event attendees during 2008-09. Researchers used an audience-intercept methodology, a standard technique in which patrons complete a written survey about their event-related spending while attending the event. The 420 nonprofit arts and culture organizations that responded to the detailed organizational survey reported that the aggregate attendance to their events was 20.4 million. These attendees spent a total of $562.5 million, excluding the cost of event admission. The following tables demonstrate the direct and total impacts of this spending.

DIRECT Economic Impact of Spending by Nonprofit Arts and Culture Audiences in the State of Missouri (excluding the cost of event admission)

 State of Missouri

 Median of Statewide
Study Regions

Total Expenditures*

$562,452,297

 $170,928,569

Full-Time Equivalent Jobs

9,573

 5,151

Resident Household Income

$169,579,000

 $78,496,000

Local Government Revenue

 $15,570,000

 $3,174,000

State Government Revenue

 $23,983,000

$13,372,000


TOTAL Economic Impact of Spending by Nonprofit Arts and Culture Audiences in the State of Missouri(excluding the cost of event admission)

State of Missouri 

Median of Statewide
Study Regions 

Total Expenditures*

$562,452,297

$170,928,569

Full-Time Equivalent Jobs

13,927

5,897

Resident Household Income

 $329,638,000

$94,109,000

Local Government Revenue

 $28,459,000

$9,074,000

State Government Revenue

 $42,311,000

$19,786,000

Visitors Spend More

In addition to spending data, the 3,119 audience survey respondents were asked to provide the ZIP code of their primary residence, enabling researchers to determine which attendees were residents (i.e., reside within the State of Missouri) and which were non-residents (reside outside the State). In the State of Missouri, 70.6 percent of the 20.4 million nonprofit arts attendees were residents; 29.4 percent were non-residents.
Non-resident arts and culture event attendees spent an average of 36 percent more than resident attendees per person ($33.77 vs. $24.90). As would be expected from a traveler, higher spending was typically found in the categories of lodging, meals, and transportation. These data demonstrate that when a community attracts cultural tourists, it harnesses significant economic rewards.

Event-Related Spending by Arts and Culture Event Attendees Totaled $562.5 million in the State of Missouri (excluding the cost of event admission)

 

 Residents

 Non-Residents

 All State of Missouri
Event Attendees

Total Event Attendance

 14,435,600

 6,011,426

 20,447,026

Percent of Attendees

 70.6%

29.4%

100%

Average Dollars Spent
Per Attendee

 $24.90

$33.77

$27.50

Total Event-Related Spending

 $359,446,440

$203,005,857

 $562,452,297


Nonprofit Arts and Culture Event Attendees Spend an Average of $27.50 Per Person in the State of Missouri (excluding the cost of event admission)

Residents 

Non-Residents 

 All State of Missouri
Event Attendees

Refreshments/Snacks
During Event

$3.93

 $3.22

$3.72

Meals Before/After Event

 $8.33

$13.60

$9.88

Souvenirs and Gifts

 $5.27

 $2.72

 $4.52

Clothing and Accessories

$1.34

$1.51

 $1.39

Ground Transportation

 $2.52

 $5.04

 $3.26

Event-Related Child Care

$0.33

$0.37

$0.34

Overnight Lodging (one night only)

$1.89

$5.94

$3.08

Other

$1.29

$1.37

$1.31

Total Per Person
Spending

$24.90

$33.77

$27.50

* Americans for the Arts’ proprietary economic impact methodology does not employ the use of an expenditure multiplier. The Total Expenditures figure listed on the data tables on Pages 4, 6, and 7 of this report are identical because we measure the economic impacts of only the actual expenditures reported.

** For more information on Arts & Economic Prosperity III, including information on downloading and purchasing all study reports, please visit americansforthearts.org.