DROWNED out by the cacophony of noise and political upheaval that followed Truss and Kwarteng’s discordant mini-Budget, the publication of UK Music’s annual report – This is Music 2022 – went unnoticed, barely raising a pulse within the media or the majority of the public.
Which is a shame, given that the music industry is such a vital contributor to the economy, and that music, whether live or recorded, indoors or outdoors, plays such an important part in so many people's daily lives and is an intrinsic component to their social wellbeing.
This well-researched report by UK Music, the collective voice of the music industry, reveals the sector's fragile recovery from the initial impact of the pandemic and urges government to protect the music industry from future economic storm.
The key findings found that in 2021 the music industry’s contribution to the economy was £4 billion – up 26% on 2020, but still down 31% on the pre-Covid high of £5.8 billion in 2019. These drops in revenue were attributed to government-mandated Covid restrictions on live venues. Employment also rose to 145,000 jobs in 2021 – up 14% on 2020 but still down 26% on the pre-Covid figure of 197,000 jobs and exports in the sector rose in 2021 to £2.5 billion – up 10% on the £2.3 billion figure in 2020 but were still down 15% on the £2.9 billion in 2019.
A mixed bag, but a more upbeat and positive outlook than at first thought, but as UK Music chief executive Jamie Njoku- Goodwin warned, “there is still some way to go to restore the jobs and growth lost during the pandemic. Our sector still faces a serious threat from the economic storm that could blow our fragile recovery off course. It’s vital that government acts to protect and support a sector that creates jobs, contributes to the economy and matters to millions of people. We need more assistance to secure our sector’s long-term recovery, including a significant cut in VAT from its current rate of 20% – something the Government did in the pandemic to support the music sector.”
Here in Scotland, the outlook for the hospitality sector is bleaker. A perfect storm of rising energy bills, soaring inflation and hikes in mortgage rates has put the brakes on many household budgets, with 21% of Scottish households, according to a recent IPSOS survey, now in “serious financial difficulty”. A greater proportion than those in the rest of UK.
And as families and households are forced to cut back on their spending, unseasonal drops in Christmas bookings and parties are being reported. Businesses, many up to their necks with Covid legacy debt and struggling with spiralling supply and energy costs, are now despairing that the festive season, as it was in 2020 and 2021, will again be empty and cheerless.
An extremely concerned Leon Thomson, executive director of UK Hospitality Scotland, said, “Hospitality businesses are contending with unprecedented rising costs, whilst customers are hit with their own cost-of-living crisis. This is resulting in some members opting to close for the winter in order to conserve cash as it is just too expensive to stay open. Others have scaled back opening times or have reduced service in order to make savings.”
A recent survey conducted by the Scottish Licensed Trade Association amplified the concerns expressed by UK Hospitality Scotland with rising energy costs identified as the biggest threat to business.
It found that 50% of premises are currently trading at pre-pandemic levels, with 5% not managing to open back up at all. Over 55% of respondents were carrying significant Covid-related debt and 45% of outlets were expected to reduce their operating hours during winter. Unsurprisingly, nearly 87% said that government support, in the form of a VAT cut and a business rates relief package, is urgently needed.
Now that really would be a Secret Santa worth opening, bringing Yuletide cheer and music to the ears of the hospitality sector and live music industries.
It’s worth remembering that it was the eventual spirit of collaboration and partnership between industry and both governments that brought us through the darkest depths of the pandemic, and that spirit of co-operation will again be needed if we are to get through the challenges on horizon.
Read more by Donald MacLeod:
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