Industry News

New Research from Oxford Economics Projects a "Cultural Catastrophe" in Creative Industries

The Creative Industries Federation has today warned of a “cultural catastrophe” as newly commissioned research from Oxford Economics reveals that the UK’s creative industries are on the brink of devastation.

The UK’s creative sector was previously growing at five times the rate of the wider economy, employing over 2 million people and contributing £111.7 billion to the economy – more than the automotive, aerospace, life sciences and oil and gas industries combined.

The new report, ​The Projected Economic Impact of Covid-19 on the UK Creative Industries, projects that the creative sector will be hit twice as hard as the wider economy in 2020, with a projected GVA shortfall of £29 billion. Many creative sub sectors are expected to lose more than half their revenue and over half of their workforce. Despite the Job Retention Scheme, the report projects that 119,000 permanent creative workers will be made redundant by the end of the year. The impact on employment is set to be felt twice as hard by creative freelancers with 287,000 freelance roles expected to be terminated by the end of 2020.

Regionally, London is projected to experience the highest drop in creative industries GVA, seeing a £14.6 billion (25%) shortfall. However, Scotland and the North East are expected to be hit hardest relatively, with projected GVA decreases of 39% (£1.7 billion) and 37% (£400 million) respectively. 1 in 6 (112,000) creative jobs could be lost in the capital, with the West Midlands expected to be most impacted in relative terms, with 2 in 5 creative jobs in the region projected to be lost. The North West and South West will also be hit hard, with both projected to lose around a third of creative jobs. This could represent a major setback to the levelling up agenda, particularly in light of research from Cambridge Econometrics, released by the PEC/Creative England this week, which suggests that, based on recovery from the 2008 recession, creative industries outside of London may take much longer to ‘bounce back’ than those in the capital.

The report, released today, follows the Creative Industries Federation’s open letter to government in April calling for urgent funding for the creative sector, which was signed by over 500 leading figures from the creative industries and beyond. In May, the Creative Industries Federation joined forces with UK Hospitality and the Association of Leading Visitor Attractions to call for an extension of the Job Retention Scheme and Self Employed Income Support Scheme, as well as the introduction of targeted grant support for those sectors who will be last to return to work.

Caroline Norbury MBE, CEO, Creative Industries Federation, said: ​“With the economic impact of Covid-19 hitting hard, the role of our creative industries has never been more critical. As well as being a huge driver of economic growth in every part of the UK, our creative and cultural sectors bring communities together, they employ millions and are at the heart of our soft power. These are the industries of the future: highly innovative, resistant to automation and integral to both our cultural identity and the nation’s mental health. We’re about to need them more than ever.

Our creative industries have been one of the UK’s biggest success stories but what today’s report makes clear is that, without additional government support, we are heading for a cultural catastrophe. If nothing is done, thousands of world-leading creative businesses are set to close their doors, hundreds of thousands of jobs will be lost and billions will be lost to our economy. The repercussions would have a devastating and irreversible effect on our country.

We urgently need a Cultural Renewal Fund for those in the creative sector who will be hit hardest, including those industries who will be latest to return to work, those businesses unable to operate fully whilst maintaining social distancing and those creative professionals who continue to fall through the gaps of government support measures. We must also avoid a cliff-edge on vital measures such as the Job Retention Scheme and the Self Employed Income Support Scheme, which have been a financial lifeline for many parts of the creative industries and cannot be cut off overnight.

It is time to both imagine and engineer our future. We will need our creative industries to do that. They are too important to ignore.”

The Creative Industries Federation is an independent, not for profit, membership organisation, of which the PPA is a member. It represents, champions and supports the UK’s creative industries.

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