The Creative Economy, the Creative Industries and the Ecology of Culture Colin Mercer

The Creative Economy: market size

The Cre ative Economy – Market Size (1999 in $ billi ons) SECTOR

Advertising Architecture Art Crafts Design Fashion Fil m Music Performing Arts Publi shing R&D Soft ware Toys and G ames TV and Rad io Video Games

Total Total by 2020 1 GLOBAL

45 40 9 20 140 12 57 70 40 506 545 489 55 195 17

2,240 6.05

US

20 17 4 2 50 5 17 25 7 137 243 325 21 82 5

960 2.6

UK

8 2 3 1 27 1 3 6 2 16 21 56 2 8 1

157 424

Source: John Howk ins (2001)

The Creative Economy: How People Make Money from Ideas

, London, P enguin.

1 Assuming 5% growth per annum on a compound basis .

The Creative Industries: definition

as ‘activities which have their origin in individu al creativity, skill and talent and which have the potential for wealth and job creation through gen eration and exploitation of intellectual property.’

Creative industries: UK sector composition and employment 2001

• • • • • • • • • • • • • Software and computer services (555,000) Publishing (141,000) Music (122,000) TV and radio (102,000) Advertising (93,000) Design (76,000) Performing arts (74,000) Film and video (45,000) Arts and Antiques market (37,000) Crafts (24,000) Architecture (21,000) Interactive Leisure Software (21,000) Designer fashion (12,000)

= 1.3 million people in industry based on creativity and intellectual property

The New Economy: characteristics

• Intellectual property and knowledge-based • Symbolic goods and cultural capital • Symbolic and cultural entrepreneurs and intermediaries • The ‘weightless economy’ of ‘bits’ rather than atoms • From marketplace to market space • Based on outputs and flows of cities/city-regions rather than nations

Four themes

:

• The significance of the creative industries at local and regional level (clustering effects) • The contribution of the creative industries to the national economy and international trade • The context of

globalisation

and

convergence

and the importance of indigenous/endogenous creative industry growth • Some conceptual issues and approaches enabling us to understand these realities (the ‘

cultural ecology’

and the ‘

value chain’)

Local example: the Lace Market/Hockley area in Nottingham

 419 registered businesses in Lace Market/Hockley area  168 businesses (40%) in Creative Industries  67% of those surveyed rated as ‘important to crucial’

for their business

location in the Lace Market area (LMA).

their  61% of those surveyed rated as ‘important to crucial ‘ capacity for meeting and networking with suppliers, collaborators, competitors in the LMA.

for their business

the  70% gave a ‘very good to excellent’ rating to the LMA as a location for combined business and social interaction.

The creative content makers

 74% rated as ‘important to crucial’

for their business

built environment.

the attractiveness of the  60% rated as ‘important to crucial’

for their business

restaurants, pubs, clubs, cafes.

the range and quality of • 57% rated as ‘important to crucial’

for their business

LMA the heritage quality of the  50% rated as ‘important to crucial’

for their business

cultural institutions.

the proximity of arts and  58% had plans for business expansion • 77% had experienced growth in demand for their product or service in the past year

The creative content users

 91% of users agreed that the LMA ‘adds vitality to the city centre area’  68% rated the LMA as a ‘safe environment’  79% rated the LMA as ‘good for shopping’  90% rated the LMA as ‘good for socialising’  20% were there for work purposes  30% were there for shopping  49% were there for social reasons

In the Greater Nottingham Area….

• 15,000 employed in 1600 businesses • 5% of the workforce (equivalent to national figures) and – Strong growth in areas such as advertising, design,software, new media, publishing – Figures do not include self-employed, freelance, etc (‘the independents’) • The cultural sector also comprises, as part of its 'ecology', organisations, large and small, which are in receipt of subsidy from local, regional and national government agencies amounting to £10.5 million in 1999-2000 .

The subsidised sector ...

 These subsidised cultural organisations directly contributed some £34 million to the economy in direct operations spending (on staff, goods, services) in 1999-2000.  Through the 'multiplier effect' this contributes, in real terms, up to £85 million annually to the economy. The more that is created and produced locally, the more this money stays in the local and regional economies.

 The subsidised organisations employ nearly 800 operational staff on both continuing and contract basis and a further 800 artists, performers and educators.

What the people think

 68% of respondents in random street and telephone surveys, across demographics and areas, placed a 'fairly high' to 'high' value on culture with: 55% agreeing that it 'encourages a sense of community' 71% agreeing that it 'helps me to understand the world and its people' 56% agreeing that it is 'important for my personal development' 47% agreeing that it encourages ‘a sense of local identity'

From quantity to quality….

• The creative industries are a

special

sector because, while economically increasingly important, they are also about: – The resources of identity – The resources of affirmation – The resources of celebration – The resources of social inclusion and cohesion – The economy of symbols,values and meanings – The quality, vitality and conviviality of lived human environments – The resources of a sustainable and creative new economy – The development of distinctive local, regional and national identities (and industries) in the context of globalisation and potential homogenisation of cultures( ref. Uruguay Gatt Round/WTO the principles of ‘cultural exception’ and ‘cultural diversity’

The Ecology of Culture

• Dynamic relationship between commercial, independent, community and subsidised sectors • Flows of people, talent, skills back and forth between these sectors • Importance of informal social networks and networking capacity (social capital) • Importance of understanding the

processes

the ‘critical mass’ that sustains it. of this ecology and

The Value Production Chain

• Pre/creation (social conditions, training, funding) • Production (infrastructure and capacity) • Dissemination and circulation (distribution through people and places) • Positioning, promotion and marketing (dissemination of knowledge) • Consumption and usages (how, why, what people are doing and to what ends - audience and market development, co-creation)

The Creative Class and the ‘Creativity Index’

• Creative class/bohemian/ share of the work force (measured by SOCs) • High Tech Industry presence • Innovation index (patents per capita) • Diversity index (overseas born, gays)

The Hong Kong Creativity Index

• Manifestations of creativity (patents, etc) • Structural/Institutional Capital (legal system, IP, treaties, etc) • Human Capital (qualifications, mobility, R&D spend) • Social Capital (charitable donations, volunteer levels, civic engagement) • Cultural Capital (cultural expenditure, participation rates, values placed on cultural activity)

The UK Creative Economy Programme

• www.cep.culture.gov.uk

• “The Creative Economy Programme is the first step in the DCMS goal to make the UK the world's creative hub .” • • • • • • • 7 working groups and reports:

Infrastructure Competition and Intellectual Property Access to Finance and Business Support Education and Skills Diversity Technology Evidence and Analysis