Arts & Economic Prosperity: FAQ

Frequently Asked Questions About the Study

1. What is this study about?

Americans for the Arts, the nation’s leading nonprofit organization for advancing the arts in America, studies the nonprofit arts, culture and humanities sector every five years. This is the fifth national study of the impact of this sector on the economy.

2. Who was included in the study?

Nationally: 341 study regions: 113 cities, 115 counties, 81 multicity or multicounty regions, 20 states, and 12 arts districts that represent all 50 U.S. states and the District of Columbia.

North Carolina: The N.C. Arts Council sponsored the statewide study and seven regional studies. Custom reports were conducted by 24 counties and 7 municipalities.

3. Why is information about the nonprofit sector useful?

The study demonstrates that the leadership of the N.C. Arts Council during the last 50 years has not only resulted in an arts infrastructure that reaches into all 100 counties but that through the support of the North Carolina Arts Council the arts are a catalyst for economic growth and vitality in our towns and cities. With N.C. Arts Council support community organizations develop innovative education programs, revitalize downtowns, promote distinctive cultural traditions and offer diverse arts programming.

Also, the study quantifies what would be missing from N.C.’s economy without the contributions of the nonprofit creative industries:

• We would lose more than $2 billion in the spending by these organizations and their audiences

• We would lose more than 71,000 full-time equivalent jobs

• We would lose the quality of life factors that encourage other growth sectors of the economy, such as tourism, business relocation and recruitment

4. What do you mean by the creative industry?

• Nonprofit arts, humanities and cultural organizations that play a substantial role in the cultural life of the community, such as government owned or operated cultural facilities, including state historic sites, libraries and museums within the Department of Natural & Cultural Resources.

• Audiences for arts and culture events

• For-profit businesses that exist to produce original creative products such as publishing and printing; film, television, radio and advertising; artists; architects, designers and photographers

• Individual artists (theaters, dance, music, writers) and creative workers

5. How does this study define economic impact?

Project economists from the Georgia Institute of Technology customized input-output analysis models for each study region. Four economic measures were calculated from the spending of organizations and audiences to define economic impact:

• Full-Time Equivalent Jobs (FTE) – the total amount of labor employed. Economists measure FTE jobs, not the total number of employees, because it is a more accurate measure that accounts for part-time employment.

• Resident Household Income (personal income) – includes salaries, wages, and entrepreneurial income; the money residents earn and use to pay for food, mortgages, and other living expenses.

• Revenue to Local Governments

• Revenue to State Government

6. What is input-output analysis?

Input-output analysis enables economists to track how many times a dollar is “re-spent” within the local economy, generating economic impact in each round of spending. A dollar “ripples” very differently through each community, which is why the model was customized for each study region. The model estimates the spin-off activity from the expenditures of the nonprofit organizations and their audiences.

7. Where can I learn more?

http://www.ncarts.org/afta

http://www.ncarts.org/creative_economy

http://www.americansforthearts.org/