ARE CREATIVE INDUSTRIES LIKELY TO MAKE A COMEBACK THIS SUMMER?

In terms of creative output, the UK is a world leader. From The Beatles and the BBC to Shakespeare and Ed Sheeran, our country is responsible for creating some of the biggest contemporary cultural influences known across the globe. Creativity permeates just about everything we do. Aside from generating immeasurable cultural value, creative businesses annually contribute more than £100 billion to the UK economy - (more than the automotive, aerospace, life sciences, oil, and gas industries combined).

Unfortunately, while the past year's events haven't left any sector unscathed, the creative industry has suffered considerable damages. Due to national restrictions that have threatened the survival of in-person venues, as well as Brexit agreements that sideline important jobs in the creative sector, it's safe to say that the UK's creative industries (as we know them), are currently under threat. However, while 2021's first financial quarter continues to appear quite damning, many industry experts are holding out hope for what the rest of this year may bring. So, by analysing the present state of the UK's creative industries, and considering what help is currently available to them, in this article, we'll be predicting what the future might have in store for our country's valuable creative industries.

However, before we explore the fate of this sector, what exactly are we referring to when we talk about these industries?

WHAT ARE THE CREATIVE INDUSTRIES?

To put it simply, the term 'creative industries' describes businesses based on individual creativity, that generate some type of creative output. As defined by the Creative Industries Federation, examples of these industries include:

• Advertising and marketing
• Architecture
• Crafts
• Publishing
• Product, graphic, and fashion design
• Film, TV, video, animation, VFX/SFX, radio and photography
• IT, video games, software and computer services (creative tech)
• Museums, galleries, libraries, and heritage
• Music, performing, and visual arts

WHY ARE THESE INDUSTRIES SO IMPORTANT?

From film to fashion and everything in between, the UK's creative sector is one of the country's most important industries. Here are three reasons why this unique sector holds so much significance for the rest of the country.

Before anything else, the creative sector is one of the UK's most critical economic powerhouses. According to a report from Enders Analysis, these industries combined engage more enterprises than any other part of the UK's economy (bar financial services), and, prior to the coronavirus pandemic, these businesses helped to contribute over £115.9 billion to the UK economy per annum. What's more, these industries were also expanding at four times the rate of the rest of the economy, which illustrates their potential in leading our country's future recovery effort.

Crucially, due to the number of businesses operating within the creative economy, these industries also represent one of the largest employers in Britain, Scotland, and Northern Ireland. According to recent employment figures from The Creative Industries, 1 in 8 UK businesses currently operate within creative industries, with these enterprises helping to provide over 3.2 million jobs throughout the country. While London, the globally renowned creative powerhouse, is the city responsible for the highest amount of employment in these industries, an estimated 2,040,000 jobs (75%) still exist outside of the capital. Not to mention, in addition to workers in fixed employment, the UK is also home to one of the largest pools of freelance creative talent, with 35% of creative employees being self-employed, compared to 15% of creative workers globally.

Last but not least, in addition to generating monetary value, our creative sector also helps to build our nation's soft power. Despite its modest size, the UK publishes more books than any other global market. It's also responsible for creating countless cultural icons - from Alexander McQueen to David Bowie - who have all influenced the world in numerous ways. As a result of these valuable, influential cultural exports, our nation consistently solidifies its place at the top of the Global Soft Power Index - but why is this so important?

Well, by maintaining cultural influence, the UK is able to stay competitive in an increasingly global market. In doing so, our country is able to access more trading opportunities, attract more international students, increase levels of tourism and cultural consumption, and generally maintain our position as a world leader in creative industries. However, while our nation has been at the top of the soft power ranking board for centuries, due to growing global competition, and the recent events of Brexit and COVID-19, our position at the top is starting to be jeopardised.

So, before we go through how likely these industries are to make a comeback this summer, here's how their survival has been threatened by the COVID-19 pandemic, and our decision to leave the European Union.

CREATIVE INDUSTRIES AND COVID-19

Unfortunately, according to The Cultural Industries Federation, the spread of coronavirus has pushed our creative industries to the brink of devastation. Due to nationwide stay-at-home measures and enormous disruptions to trading, the global forecasters' Oxford Economics projections have estimated that the UK creative industry's income dropped by £74 billion in 2020 - which marks a total loss of around £1.4 billion each week. This means that our creative sector has been hit almost twice as hard as most of the UK's other core industries.

Since social distancing restrictions forced them to close their doors as early as March 2020, the first to see revenues drop were venue-based businesses, including galleries, theatres, cinemas, and concert venues. Throughout 2020, according to the same report by Oxford Economics, these entertainment venues lost around £11 billion in revenue, with the music industry expected to have lost an extra £3 billion due to the collapse of live music and touring. Due to reduced audiences and restrictions on in-person production, the UK's film, TV, radio, and photography sectors have also been projected to lose over £36 billion over the last year. Other vital creative industries that suffered monumental losses were advertising and publishing, which saw their respective turnovers drop by £19 billion and £7 billion annually.

These economic losses also had a substantial impact on unemployment. Throughout the past year, 406,000 (1 in 5) creative jobs were estimated to be lost. To put this number into perspective, this figure is nine times greater than the workforce of British Airways, and three times greater than the workforce of Asda. Additionally, for those lucky enough to remain in stable employment, according to a survey of over 800 creative practitioners and organisations, 63% saw their turnover decreased by more than half since the start of the pandemic. While this impact was universal, freelancers and those based outside of London incurred more considerable income losses.

CREATIVE INDUSTRIES AND BREXIT

Unfortunately, COVID-19 wasn't the only force to disrupt the creative sector in recent months. At the beginning of 2020, the Withdrawal Agreement Bill passed its third and final reading in the house of commons, and the UK officially withdrew from the European Union. While the transition triggered consequences throughout most of our country's major sectors, many agree that our cultural industry has been disproportionately impacted.

Despite the creative sector's substantial contributions to the UK economy, Caroline Dinenage, Minister of State for Digital and Culture, complained that the industry was treated as an 'afterthought' during negotiations. These feelings were backed up by Julian Knight, MP for Solihull and DCMS committee chair, who commented that Britain's cultural sector had essentially been left to endure 'a no-deal Brexit' when talking to the Guardian earlier this year.

This anger was predominantly sparked by the new visa rules that have been put in place for British artists, actors, and theatre workers, who plan on travelling to Europe to work. Under these new regulations, UK-based artists are required to fill out comprehensive paperwork, pay hundreds of pounds, and wait at least a couple of weeks, in order to obtain legal working visas. This is in stark contrast to when artists could travel to Europe visa-free before we left the European Union.

While it's clear how this bill will affect emerging creative talent and our country's lucrative touring industry, some fear that it will also disrupt significant trading opportunities. This is because, with legal barriers preventing the free and easy movement of creative professionals between the UK and EU member states, it's likely that UK-based and international companies may increasingly choose to station themselves out of Britain to avoid the legal red tape.

The bill, which has already forced a British-based pianist to fork out £600 in visa-related costs to perform at a concert in Spain, has faced wide backlash across the creative community. The new regulation has even led high profile figures like Miriam Margolyes, Sir Ian McKellen, and Julie Waters to sign a letter that addresses the obstacles in place for creative practitioners who want to work in Europe once COVID-19 restrictions eventually lift.

GROUNDS FOR OPTIMISM

So, with nationwide lobbying efforts taking place to address the crippling impact of COVID-19 and the recent Brexit agreements, what recent developments give our creative industries grounds for hope?

Cultural Recovery Fund

In a robust effort to prevent the further deterioration of our creative sectors, in July 2020, the government announced the Cultural Recovery Fund. Initially described by Chancellor Rishi Sunak as a "one-off investment in UK culture", the rescue package was designed to provide more than £1.5 billion of support to help creative industries make a swift rebound from the impact of the pandemic. It includes proposals to drive recovery by focusing on innovation, access to investment, skills, talent, financial incentives, and international trade; its main objectives are focused on protecting creative jobs in the UK, securing pipelines of new talent, and re-establishing our country's status as a global creative hub.

To date, the support scheme has offered almost £400 million in support to more than 2,700 organisations. Out of this total, £81 million has been allocated to cultural landmarks in the form of tailor-made loans, and the remaining £300 million has been administered to festivals, entertainment venues, and museums; such as Glastonbury Festival and Bamburgh Castle, in order to help these institutions make it through the summer months.

While the majority of those in creative industries have welcomed this package with open arms, the scheme has received backlash for not supporting those who have missed out on government support, such as freelance workers. What's more, digital, culture, media and sport committee chair Julian Knight (MP) has also criticised the fund for not providing a safety net for festivals that are unable to go ahead this summer. So, it seems that while the Cultural Recovery Fund has clearly offered many in the creative sector with reassurance, more comprehensive measures are required to stop key groups from being further left behind.

Roadmap to Recovery

In a move that gave hope to all of the UK's core industries, on February 22nd 2021, the government announced their roadmap to ease lockdown measures. Subject to the success of the vaccination rollout, this four-stage plan allows socially distanced inside performances to return from May 17th, followed by full capacity operations returning from June 21st. For businesses that have been under some sort of lockdown since March of last year, this roadmap opens up exciting opportunities for future growth.

Responding to the Prime Minister's statement, the chief executive of the Society of London Theatre and UK Theatre, Julian Bird, commented: "We welcome the Government's roadmap announcement as the country takes the first steps towards easing lockdown – in particular, the news that theatre and live arts can resume performances for Step 3 with social distancing, potentially as early as May 17th". Before pointing out "the real route back for the sector will be the Step 4 announcements hopefully enabling full auditoriums from June 21st."

This cautious optimism was echoed by Caroline Norbury, CEO of the Creative Industries Federation, who said, "Today’s roadmap includes some welcome milestones for reopening parts of the UK’s creative industries, including our world-leading theatres, cinemas, and live events. However, it is critical that everyone in our sector is supported until they are able to resume normal levels of operation, which could be well beyond summer.”

Spring Budget

In March, the government released their Spring Budget. While the proposal prioritised our nation’s tech and R&D sector, it also intended to drive well-needed economic growth within creative industries. As part of this budget, the government extended the Film and TV Production Restart Scheme for an extra six months, postponing its end date until December 31st 2021. In a bid to support the film and TV industries, the scheme enables businesses to claim compensations for coronavirus-related losses. It will undeniably help to promote business within these sectors.

This year's Spring Budget also announced a £7 million ‘flexi-job apprenticeship programme’ which would allow those in apprenticeships to work across multiple projects with different employers, to encourage flexibility within the industry. The programme will enable apprentices to sign up to agencies instead of single employers, to help them develop their skills from a range of creative sectors at once, such as TV, media, and film.

While many features of the budget were welcomed by creative workers, the budget also calls for a rise in National Insurance Contributions (NIC) for self-employed workers, from 9% to 10%. This controversial move has sparked a backlash among our creative community. According to the former head of the creative industries union Bectu, Gerry Morrissey, this policy change is a “slap in the face for thousands of freelance members” who run genuine small businesses, carry more significant economic risks, and pay greater costs without any guarantee of future work from any engager.

ROOM FOR IMPROVEMENT

So, despite the government’s effort to protect the UK’s creative sector, much more could be done to fuel our nation's creative and cultural recovery. As we enter the crucial summer months, here are some ways we believe broader and more sustainable growth can be achieved among creative industries.

Focus on growth outside of London

While it’s true that our nation’s capital is home to almost one in three creative jobs in the UK, many experts complain that London receives a disproportionately large amount of government support and funding. As we outlined when addressing COVID-19’s impact on unemployment, creative workers based outside of London have been by far the hardest hit. So, if the government doesn’t prioritise supporting less affluent areas like the North East of England, Scotland, Wales, and Northern Ireland, these regions could take a much longer time to ‘bounce back’.

In order to combat this issue, The Creative Industries Federation is urging the government to expand tax relief for the Creative Industries, and to set up a government-backed insurance scheme for live events. Furthermore, to address the additional issues posed by Brexit, the federation are also calling on the government to seek urgent renegotiation with the EU. In doing so, they are hoping that barriers around touring can be removed, so that the creative economy across the UK can grow as a whole.

Introduction of a Seat Out to Help Out Scheme

Another way for more sustainable growth to be achieved in the creative sector is through the implementation of more government incentives. Last August, the government announced their Eat Out to Help Out Scheme, in a bid to prop up our nation's struggling hospitality industry. Throughout the duration of this scheme, more than £849 million was claimed, and countless businesses in the service industry were supported. In September of last year, a similar proposal was introduced for our country’s equally devastated entertainment industry.

The scheme, dubbed Seat Out to Eat Out, was intended to support venues such as theatres, concert halls, and stadiums by covering half of the customer’s ticket when they reopened at reduced capacity on August 15th. However, due to a widespread resurgence of COVID-19 cases in Autumn last year, the plan was put on ice until a safer rollout could be guaranteed.

Currently, with indoor venues set to open as early as May 17th, and remaining settings like nightclubs and significant events opening as early as the 21st of June, a government-led measure like Seat Out to Help Out could provide a much-needed lifeline to public venues that have seen their numbers compromised since March 2020. Also, in addition to the apparent boost a scheme of this nature would give to our country’s creative economy, after a year of strict stay-at-home measures and national bans on indoor entertainment, this kind of incentive could also provide millions of UK citizens with a light at the end of the tunnel.

More government support for the self-employed

As we’ve addressed, throughout the COVID-19 pandemic, creative freelancers have consistently fallen through the gaps of government support. As this survey by Bectu reveals, after one year of the coronavirus, 21% of workers entitled to the Self Employed Income Support Scheme (SEISS) have not been able to access support. Additionally, for workers that have been receiving support, (from SEISS and elsewhere), 77% have witnessed a drop in income throughout the same time span.

When addressing this discrepancy in income support, Philippa Childs, head of Bectu, remarks: “One year on, and the government has done little to address the well-documented gaps in their support schemes. Unions, business groups, mayors, and campaigners have repeatedly proposed solutions, but these seem to have fallen on deaf ears.” Indeed, with plans to hike up National Insurance Contributions (NIC) to 10% for self-employed workers, if the government doesn't propose extreme measures to support this part of the workforce soon, the prosperity of the whole creative sector could be sacrificed.

FINAL THOUGHTS

The months ahead are likely to be crucial for the future success of the UK’s creative industries. While glimmers of hope exist, predominantly in the form of government support mechanisms and the gradual lifting of lockdown measures, much more work remains to be done if the UK’s creative economy has any hope of recovering by the end of 2021.

These industries don’t only provide our country with innumerable job opportunities and sustainable economic growth; they are also a powerful force for social good. A thriving creative economy has the power to improve citizens’ quality of life by boosting productivity, social integration, mental wellbeing, and innovation. Therefore, if we want to pave the way for a cultural revival in the UK, it’s essential that we make a concerted effort to recognise the value of our creative institutions - as well as the diverse workforce who depend upon its success.