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NEWS from the Office of the New York State Comptroller
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COVID-19 Causes Big Financial Hit to NYC Arts, Entertainment and Recreation Industry

Sector Employment Remains at April 2020 Levels
February 24, 2021

Live Discussion About Industry Challenges on Facebook Today at 2 pm

New York City’s world-renowned arts, entertainment and recreation sector saw the largest decline among all sectors in the city’s economy due to the COVID-19 pandemic, as employment declined by 66 percent over a one-year period ending in December 2020, according to a report released today by New York State Comptroller Thomas P. DiNapoli.

DiNapoli urged the state and city to work in coordination to provide establishments with clear guidance for venues to reopen and make use of outdoor space to expand audiences. A joint partnership better facilitates the flow of federal relief and healthcare supplies to individuals and businesses.

“There isn’t a city in this world that offers a more dynamic or deeper array of venues and museums for arts and entertainment than New York,” DiNapoli said. “The COVID-19 outbreak has had a profound and negative impact on the industry. It has forced facilities to close, thrust thousands into unemployment and pushed businesses to the brink of collapse. Direct relief from the federal government, and state and local programs to create safe venues for artists and entertainers are steps in the right direction, but more help is needed to keep the lights on."

DiNapoli called on federal, state and city officials to collaborate to manage risks to the industry for the duration of the pandemic. These actions include:

  • Extending unemployment relief commensurate with need, including extended relief for freelancers and self-employed workers;
  • Providing establishments with defined and achievable milestones for reopening that are aligned at the city and state levels;
  • Enabling the use of outdoor space with flexible guidelines and simple permitting processes as weather warms;
  • Facilitating the flow of federal funding to firms and not-for-profit organizations through outreach and technical assistance; and
  • Delivering healthcare supplies, including rapid tests and personal protective equipment, so that venues can reopen safely.

"The arts, entertainment, and recreation industry are vital to the social, cultural, and economic life of New York City, and this report by State Comptroller DiNapoli finds that the city and state must be proactive in stemming the cultural sector's economic downturn," said Manhattan Borough President Gale A. Brewer. "I commend Comptroller DiNapoli for bringing urgent focus to this crisis with this study and for providing key policy recommendations to sustain the recovery of our city's creative sector."

"The arts and entertainment sector make New York one of the most dynamic places in the world, and will play a key role in our state's financial and emotional recovery from the COVID-19 pandemic,” said State Senator José M. Serrano (D-Manhattan/Bronx). “Federal, state, and city government must work together to ensure that this once-thriving industry not only survives the current crisis, but is able to come back stronger than before by creating new jobs and bringing tourism dollars back to New York. Thank you to State Comptroller DiNapoli for compiling a report that clearly outlines why focusing our reopening energies on the arts and entertainment sector makes good economic sense for our state."

"This vital economic study from State Comptroller DiNapoli could not have come at a more critical time, and we thank all of the team members for their foresight, effort and care that led to the creation of this key resource,” said Aimee Todoroff, League of Independent Theater Managing Director. “We know our indie theater sector is in peril, yet we are hopeful the data in this study will generate real policies to ensure the survival of the artists who make New York the cultural capital of the world."

“Local One is the oldest entertainment union in the United States and will be 135 years old this April,” said James J. Claffey Jr., Local One I.A.T.S.E President. “We are also the largest stagecraft local in the world. Right now, though, our members are suffering and we need help. I want to thank State Comptroller DiNapoli for highlighting the harsh realities we're facing and for providing much-needed guidance on getting our union brothers and sisters back to work."

"The COVID-19 pandemic has had an outsized impact on the arts and entertainment industry,” said Rebecca Damon, SAG-AFTRA Executive President and New York President. “The fact is many creative professionals in our industry will be some of the last workers able to return safely to their jobs. We stand ready to work with the state, and the State Comptroller's office in returning New York’s creative arts sector to the powerful jobs driver it has always been. We thank State Comptroller DiNapoli for shining this crucial light on our industry."

In February 2020, nearly 87,000 people were employed in the sector. In April, after the pandemic’s statewide stay-at-home order went into effect, almost 53,000 jobs were lost.

Arts, Entertainment and Recreation Employment, 2020

FIGURE 7 Arts, Entertainment and Recreation Employment, 2020

Sources: NYS Department of Labor; OSC analysis

Taxable sales declined by 76 percent between March and November in 2020. Womply, a software services company that tracks credit card transactions from hundreds of millions of cardholders, estimates that as of Feb. 4, 2021, 59 percent of both arts and entertainment businesses and 63 percent of sports and recreation venues have closed temporarily or altogether since the beginning of March, the highest among all other businesses reported by the company except for bars and lounges.

Federal Assistance Post-Outbreak

Census Bureau data shows that the arts, entertainment and recreation sector statewide has relied heavily on federal resources to ease the impact of the pandemic.

In March, the Coronavirus Aid, Relief, and Economic Security (CARES) Act established the Pandemic Unemployment Assistance (PUA) program, which expanded eligibility for unemployment insurance to independent contractors and self-employed workers, many of whom work in the arts sector. Recipients were eligible to receive an additional $600 per week through the Federal Pandemic Unemployment Compensation (FPUC). The new Consolidated Appropriations Act, enacted in January 2021, provides for an additional 11 weeks of PUA unemployment benefits that will end on March 14, 2021, and an extra $300 per week of FPUC.

The CARES Act also earmarked funds for federal arts organizations. The Institute of Museum and Library Services, the National Endowment for the Arts and the National Endowment for the Humanities each received between $50 million and $75 million to be distributed through grants supporting various entities including the Frick Collection, the Lower East Side Tenement Museum and the American Folk Art Museum, among others.

It also established the Paycheck Protection Program (PPP) and expanded the U.S. Small Business Administration’s existing Economic Injury Disaster Loan (EIDL) Program. PPP loans supported 62 percent of firms and 70 percent of employment in the sector. The new Consolidated Appropriations Act added $284 billion to the PPP program, ending March 31, 2021. Other relief provisions include $15 billion in grants for shuttered arts organizations such as independent live venues, movie theatres and museums, with additional grants set aside for closures that extend into the second half of 2021.

President Biden’s proposed $1.9 trillion COVID relief bill includes provisions helpful to this sector, particularly extending unemployment insurance programs from March into September. The bill also sets aside about $270 million in grants for arts and humanities organizations and museums, and another $23 billion is available through federal loans programs to help small businesses and not-for-profit organizations.

Sector Characteristics and Geography

In the decade leading up to the pandemic, this sector of city’s economy was thriving. From 2009-2019, arts and recreation employment in the city grew by 42 percent, much faster than total private sector employment (30 percent), with growth spread across many areas. The number of establishments increased by 28 percent (compared to 19 percent growth across all sectors) and total wages rose by 78 percent (64 percent for all sectors).

Manhattan dominated industry activity with 76 percent of the jobs, 70 percent of the establishments and the highest average salary among the boroughs at $81,920. The Chelsea/Clinton/Midtown Manhattan Business District neighborhood, which contains both the Theater District and the recreation complex Chelsea Piers, had the largest concentration of jobs and establishments, accounting for nearly half (46 percent) of all arts, entertainment and recreation jobs citywide. The Upper West Side/West Side, which includes Lincoln Center and the American Museum of Natural History, had the second-largest employment, accounting for one out of 10 sector jobs citywide.

Share of Employment & Firms by Borough in Arts, Entertainment and Recreation

Borough Jobs Firms Average Salaries Share of Jobs
Manhattan 70,950 4,400 $81,920 76%
Brooklyn 10,160 1,080 64,840 11%
Queens 7,100 520 61,870 8%
Bronx 3,800 130 33,540 4%
Staten Island 1,500 140 29,590 2%
NYC $93,500 $6,250 $79,290 100%

Note: Columns may not add to totals due to rounding.

Sources: NYS Department of Labor; OSC analysis

After the statewide stay-at-home order went into effect on March 22 and all facilities were closed to the public, sector employment plummeted to 34,100 jobs and has remained at or near these levels. In the last few weeks, the state has announced reopenings of large arenas, movie theaters, billiard parlors, indoor family entertainment centers and outdoor amusement parks between late February and early April, all with reduced capacity. Continued clarity and supplies to provide safe reopening will be necessary to continue to improve the sector’s outlook.

Report
Arts, Entertainment and Recreation in New York City: Recent Trends and Impact of COVID-19


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