CT’s nonprofit arts and culture organizations contribute $1 billion to economy, report finds

A national arts advocacy organization, Americans for the Arts, found that spending by arts and cultural organizations in 2022 supported 2.6 million jobs nationwide, $152 billion in spending and $29 billion in income and sales tax revenue to local, state and federal governments.

The group’s latest report, “Arts & Economic Prosperity 6,” argues that “Nonprofit arts and cultural organizations are businesses,” contributing to local economies by creating jobs, purchasing goods and services from local businesses and promoting their local regions by drawing visitors and spending.

Randy Cohen, the organization’s vice president of research, said the periodic report focuses on nonprofit organizations because they receive public funding.

“It’s an appropriate question to ask: ‘What’s the ROI on that public investment?’” Cohen said during a presentation of the report’s findings Thursday.

“Everybody gets, ‘Yeah, it provides cultural benefits.’ But now we can also start to see in the data that it provides social and economic benefits as well,” he said.

In Connecticut, nonprofit arts and culture organizations spent $606 million on payroll and business-related supplies and services, while audiences contributed another $350 million in event-related spending on things like meals, lodging and local transportation. That generated nearly $1 billion in economic impact, the report found.

Elizabeth Shapiro, who leads the Connecticut Office of the Arts within the Department of Economic and Community Development, said that return on investment is strong. Her office’s annual budget is roughly $2.5 million, including $1 million in federal funding and $1.5 million from the state.

“Often people think of the arts as extra, and they’re not always aware of the contribution that arts and culture make to our Connecticut economy,” Shapiro said. “The reason that it’s critical to have these numbers and to share them is because this is a significant industry in this state.”

And while nonprofit organizations don’t have tax liability, the industry still generates tax revenue in the form of levies on employee income and sales taxes on audience spending. In 2022, that amounted to nearly $200 million in local, state and federal tax revenue from Connecticut organizations alone.

But Shapiro and others said the numbers in the report don’t capture the entirety of the economic impact of arts and culture in Connecticut, because much of their value is difficult to measure.

Noah Bloom, executive director of New Haven’s Neighborhood Music School, said performing arts students learn skills that translate well in the business world, for example, like creativity, problem-solving, collaboration and time management.

Institutions like NMS foster community, providing networking opportunities that could lead to jobs or partnerships. And they’re an amenity that can attract new residents considering relocating for work. Bloom said he’s played host to recruiters from nearby universities while they’re showing a job candidate around town or trying to get them to accept an offer.

“They’re like, ‘What can we do to sell them?’ Well, here’s a great place that will serve the kids.”

And there are clear economic impacts, Bloom said, when parents of students at the school are able to pick up a shift at work while their kids are attending classes.

“Numbers like that don’t show up in an arts economic impact report, but we know that’s real,” he said.