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Survey Reveals Significant Impact of COVID-19 on Cultural Sector

Bethann Steiner, Public Affairs Director

MA cultural nonprofits report $425M in lost revenue with 17K jobs impacted and $441.8M in total recovery costs

Odaiko New England performance of Taiko Drumming
Odaiko New England performance of Taiko Drumming

During the month of June Mass Cultural Council surveyed nonprofit cultural organizations throughout Massachusetts on the economic impacts of COVID-19, as well as the recovery strategies necessary in order to safely reopen and reengage with the public.

“This is the third economic impact survey conducted by Mass Cultural Council since March,” said David T. Slatery, Acting Executive Director, Mass Cultural Council. “We are seeking to bring information to policymakers on the financial, human, intellectual, and social capital needed for cultural nonprofits to fully recover. With this instrument we intended to collect data on our field’s existing recovery timelines and strategies, identify specific implementation needs, and determine the total financial investment required to make our sector healthy again.”

The COVID Recovery Survey was developed in coordination and partnership with the Nonprofit Finance Fund (NFF). It was widely disseminated and open to all cultural nonprofits in Massachusetts, regardless of size, location, operation budget, or even whether the organization is a grantee of the Agency. In all, 392 nonprofits responded to the survey.

Respondents representing all cultural disciplines reported annual spending budgets ranging from $50,000 to $145 million and locations in every county in the Commonwealth.

Key Findings:  The Economic Impact of COVID-19 on Cultural Nonprofits

Mass Cultural Council’s COVID Recovery Survey finds that to date Massachusetts’ cultural nonprofits have lost $425 million in revenue due to COVID-19 cancellations and closures.

Chart detailing lost revenue as a result of COVID-19
Lost revenue as a result of COVID-19.

This startling figure can be broken down into earned revenue and contributed revenue losses:

  • $365.4M lost in earned revenue
  • $59.5M lost in contributed revenue

While grim, this figure makes sense as respondents showed programming and fundraising were heavily impacted by COVID-19.  Since March, at least 98% of respondents had to cancel in-person programmatic activity and 79% had to cancel funding events/activities.

“Cultural nonprofits are more at risk than other industries because of their operation and programming models,” said Slatery.

Ninety-three percent (93%) of survey respondents provide programming “mostly in person”; 88% of responding organizations provide programming “mostly indoors”; and almost 1/3 of survey respondents provide programming aligned with school activity or direct cultural programming in schools.

“While the necessary public health measures in place for the past 18 weeks – like social distancing and COVID-related closures – have resulted in beneficial public health outcomes, they have also wreaked havoc on the economics of the cultural sector,” said Slatery. “The continued unknowns about the future complicate the planning process for cultural organizations.”

Cultural sector employees have been heavily impacted by COVID-19 as well. Sixty-eight percent (68%) of responding organizations indicated that they expect layoffs, furloughs, and reductions in pay and working hours for their employees. These difficult decisions will impact 17,020 employees and their jobs statewide.

Chart detailing Total Number of People/Jobs Impacted
Total Number of People/Jobs Impacted

Recovery Timeline and Needs

Cultural nonprofit organizations estimate that it will take on average two years (and in some cases, up to five years) to recover programming and financial status back to pre-COVID levels. Time, expertise, and resources are necessary to implement recovery strategies so the public will feel confident in reengaging with cultural programming.

Recognizing that it will take time for the public’s comfort levels to return, 40% of survey respondents noted that they were unsure when to reopen, even if allowed by state reopening guidelines.

When identifying recovery strategies necessary to reopen, survey respondents prioritized changes to core programming, such as:

  • Reduced occupancy for programming
  • Shifting program delivery from in-person to virtual, or from indoor to outdoor
  • Making capital investments like HVAC adjustments for public health and safety
  • Making changes to, or eliminating, concessions and other sources of earned income
  • Implementing other changes like transitioning employees to work remotely, providing the equipment necessary to do so, increasing cleaning services, signage, and sanitizing or hand-washing stations for employees and audience members.

The cost of implementing recovery strategies, to reopen to the public, as identified by survey respondents is $117 million.

Chart detailing what is needed to implement recovery
What is needed to implement recovery?

Total Cost of COVID Recovery

Mass Cultural Council’s COVID Recovery Survey finds that the total cost of recovery for Massachusetts’ cultural nonprofits is $441.8 million. This figure includes the revenue loss to date ($425M) and the cost of implementing recovery strategies ($117M), minus COVID relief already leveraged from federal, state, and non-governmental sources ($100.2M).

Advocacy/Moving Forward

Mass Cultural Council presented the findings from its COVID Recovery Survey to members of the Massachusetts Senate during a Listening Session focused on the reopening of Tourism, Arts, Culture and Small Business on July 15. During the presentation, Agency officials urged the Senate to consider a robust public investment in the cultural sector – and to consider the long-term economic impacts of not helping cultural nonprofits rebuild and reopen. Mass Cultural Council was joined at the Listening Session by MASSCreative, our statewide advocacy partner, and NFF.

Prior to March, the cultural sector supported 17,000 jobs across Massachusetts and made an economic impact of $2.3 billion.

“We now know that 1 in 4 cultural sector jobs have been impacted by COVID,” said Slatery. “Public investment is necessary to restore these jobs and help the sector flourish across Massachusetts again.”

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