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October 25, 2011 | last updated March 6, 2012 1:35 pm
Portlandbiz

Report: Arts and culture nonprofits economic driver

Photo/Rebecca Goldfine
Photo/Rebecca Goldfine
Jean Maginnis, executive director of the Maine Center for Creativity, touts the impact of the state's arts and culture nonprofits

A look at the numbers

Number of organizations: 2,292

Amount spent: $262 million

Employees: 5,246

Total economic impact: $525 million

Gross product ranking in the state: 28th among 46 major sectors

Employment ranking in the state: 37th among 65 major sectors

New England's nonprofit arts sector is a job-generating, financially robust sector of the economy, despite stereotypes to the contrary, according to a new report released by the New England Foundation for the Arts.

"Nonprofit arts and cultural organizations are not viewed as part of the business community," says Linda Varrell. "There's a cloud of misconceptions around nonprofits." Varrell, president of Broadreach Public Relations in Portland, is a spokeswoman for the Maine Center for Creativity, also based in Portland, which authored the NEFA report along with economists Chuck Lawton of Planning Decisions Inc. and Charles Colgan of the University of Southern Maine.

Varrell says people tend to believe that nonprofit arts groups are elitist and supported by the wealthy, or are subsidized by government hand-outs -- and that they're run sloppily, with a lot of waste.

To help dispel these "myths," as Varrell calls them, she and Jean Maginnis, the executive director of the Maine Center for Creativity, are holding up the new report as evidence that nonprofit arts and cultural organizations are making jobs and contributing to local economies -- and doing it despite the worst recession since the Great Depression. The report is part of a regular assessment of the regional arts-and-culture economy by NEFA, which hires economists to analyze the financial data from thousands of nonprofits in Maine, Massachusetts, New Hampshire, Vermont, Connecticut and Rhode Island every few years. The last report was published in 2006.

According to the most recent report, New England's 18,026 arts and culture nonprofits spent nearly $3.7 billion in 2009 and provided jobs for over 53,000 people. "By comparison, that spending total is fully $1 billion greater than the gross product of the region's entire paper manufacturing industry and nearly as large as the gross product of the region's information and data processing industry," the report says.

Lawton and Colgan's calculations show that the $3.7 billion in direct spending generates $8.4 billion in revenue to businesses across New England, and that the 53,270 arts and culture jobs support nearly 30,000 extra jobs for related vendors and consumer businesses, for a total of 83,000 jobs.

The report's numbers also indicate that between 2002 and 2009, through a sallow economy, nonprofit arts and culture organizations in New England grew. They jumped in number by 14%, their spending increased 24% and their employment grew 28%. More specifically, between 2007 and 2009, when New England's total personal income fell 0.5% and the number of employers fell 0.6%, the number of nonprofit arts and cultural organizations increased 1.1% and their spending rose 11.5%, even while their assets dipped nearly 7%. (The report offers the disclaimer that part of this growth could have to do with the higher number of organizations included in its analysis.)

Maginnis says that arts organizations are less vulnerable to the ups and downs of economic cycles than some other industries. "It's a basic human need for beauty, culture and storytelling," she says. "The nonprofit sector is putting money into people and storytelling, and that money comes back threefold."

Lawton also suggests that cultural organizations' endowments give them a degree of stability over private businesses. Plus, he adds, "My own interpretation is that these organizations view themselves as long term. Even though their revenues are down they're not going to cut down performances. They may try to economize or try to be more efficient, but they're going to maintain their offerings."

Maine and Vermont's arts sectors in particular have fared well, the report finds. While Massachusetts and Connecticut have by far the largest number of organizations, both Maine and Vermont have more nonprofits per capita, especially more libraries, historical organizations and museums. Maine also exceeds the regional average for all the categories included in the report (there are 12, including fairs, media, humanities, performance, multi-discipline, schools and visual) except in ethnic and service organizations.

"The larger point made by these indices ... is that nonprofit arts and cultural organizations play a particularly vital role in the social life of New England's smaller, more rural states and communities," the report concludes. Lawton says that in many northern New England towns, "your community is your own entertainment. You're not as able to go to the big museum or theater group that draws people from all over. And by the same token, the historical society's bean supper is not competing with the Museum of Fine Arts."

Maginnis says she'll use the report to advocate for nonprofit cultural organizations and to educate policy makers. She makes the point that the nonprofit arts sector could be supported much like the emerging technology sector in Maine, which is boosted by seed grants and investment from the Maine Technology Institute.

"The nonprofit arts organizations are creating something from nothing," Maginnis says. "Business people know that when they innovate, and create a new product, that is when a business grows."

Read more

Conference to showcase Portland's creative economy

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