Employment in Wisconsin arts and cultural sectors has rebounded substantially from the COVID-19 pandemic, due in part to an unprecedented federal and state relief effort, according to a Wisconsin Policy Forum report.

 

While the most accurate data show employment in these sectors had not fully recovered by fall 2021, preliminary data from early 2022 suggest employment increased further in recent months. Meanwhile, other indicators are even more encouraging: few arts and cultural organizations were lost due to the pandemic, and sales tax revenues from these sectors have largely rebounded.

 

The new report, “State of the Arts,” is a follow-up to the Forum report from 2020 that, amid the pandemic, found Wisconsin arts and cultural organizations facing an “existential threat.” It found arts and cultural organizations and individual artists were among the hardest-hit by COVID-19 – a development that threatened damage to the economy and quality of life in Wisconsin communities.

 

But now, as the pandemic recedes from prominence, new data analyzed by the Forum find these sectors showing signs of recovery — buoyed by hundreds of millions of dollars in federal funds.

 

“While considerable challenges remain, there are reasons for optimism as the worst phases of the pandemic seem to have passed,” the report found.

 

Key findings from the report include:

 

Employment in arts and culture – including jobs in performing arts, spectator sports, museums, historical sites, and video and sound recording and production — recovered considerably in 2021. As of September 2021, it remained more depressed than in the economy overall. Still, by February 2022, Wisconsin employment in a broader sector that includes the performing arts and museums subsectors, as well as other recreation and amusement subsectors, actually exceeded 2019 levels. In the coming years, it will be important to continue to track data to gauge whether arts and culture employment makes a full and sustained recovery.

 

The motion picture and sound recording subsector, which includes movie theaters, appears to face the largest lingering recovery gap in employment in Wisconsin. This may warrant a closer look by policymakers.

 

Sales tax revenues collected by the state from three arts and culture subsectors exceeded 2019 levels in the third quarter of 2021 by 13.2% and were near 2019 levels in the fourth quarter. Yet it is unclear the extent to which this can be attributed to a recovery in patronage, as opposed to higher prices that reflect increasing inflation.

 

 

Arts and cultural organizations faced dire circumstances amid the pandemic, so it is notable that their total numbers have since held steady and even grown. After dipping in the first quarter of 2020, the number of establishments across three arts and culture subsectors has risen slowly and (at 1,104) was 6.4% higher in the third quarter of 2021 than at the same point in 2019.

 

Unprecedented relief

 

A pivotal factor that helped Wisconsin’s arts and cultural organizations and independent artists weather the pandemic was a series of federal and state pandemic relief programs that primarily provided grants or forgivable loans.

 

Our analysis shows roughly $440 million in pandemic relief funding has been dedicated to arts and cultural establishments in Wisconsin over the last two years. Nearly all came from the federal Coronavirus Aid, Relief, and Economic Security (CARES) Act or the American Rescue Plan Act (ARPA).

 

“Without that support, it is possible that many more organizations and businesses throughout Wisconsin would have been lost,” the report finds.

 

Our analysis finds:

  • The single largest source of relief came from the federal Shuttered Venue Operators Grant (SVOG) program, which provided operational support to a range of arts and cultural organizations during the pandemic. This program distributed $14.2 billion nationally in 2021, including $221 million (1.6%) to 235 Wisconsin venue operators.
  • The first and one of the largest relief sources was the federal Paycheck Protection Program (PPP), a forgivable loan program launched in April 2020. Our analysis found 3,345 loans totaling just over $119 million went to arts and cultural establishments in Wisconsin.
  • The state also created programs to distribute federal pandemic relief funding to arts and cultural organizations and businesses. The largest was the Live Event Small Business Assistance Grant Program, which provided $31 million.
  • Wisconsin appears to have placed greater emphasis than other states on using its federal ARPA allotment to support arts and culture. Data from the National Conference of State Legislatures (NCSL) show that so far Wisconsin has allocated 5.8% of its one-time ARPA funds toward arts, culture, and tourism, while states nationally averaged 1.7%.
  • The state’s above-average use of federal pandemic relief funding to support arts and cultural establishments contrasts with state policy that places Wisconsin at or near the bottom of all 50 states in ongoing annual public funding support for arts and culture.

 

Arts and cultural organizations and activities contribute greatly to Wisconsin’s vitality and economy, and the pandemic posed a major threat to their sustainability. Our analysis shows there are reasons for optimism, though challenges remain.

 

Pandemic relief funding that helped prop up many organizations and businesses will run out in 2022 or 2023. Employee hiring and retention may pose difficulties given low unemployment and rapid inflation. And while income from earnings and charitable contributions has rebounded, it may not have returned to pre-pandemic levels.

 

Click here to read the report, “State of the Arts.”

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