C o m p i l e d b y L i n d s e y S m i t hl i n d s e y s m i t h 0 0 @ y a h o o . c o m

J u l y 2 0 1 5

The Economic Impact of Museums

Photos, clockwise: Lincoln Log Cabin State Historic Site, La Brea Tar Pits and Museum, LACMA, The Getty Institute, Amherst Museum, Perot Museum, London Museum of Natural History. © Lindsey Smith

How are Museums Funded?

“Precariously.”- Ford W. Bell, former director of the American Alliance of Museums

Taken from: “How Are Museums Supported Financially in the U.S.?” By Ford W. Bell, published by the Embassy of the United States of America.

But does this mean that museums do not have an economic impact on society?

They absolutely do!

Museums directly contribute $21 billion to the U.S. economy each year. They generate billions more through indirect spending by their visitors.

Fact from: http://www.aam-us.org/advocacy/resources/economic-impact-statement

• 7 8 % o f a l l U . S . l e i s u r e t r a v e l e r s p a r ti c i p a t e i n c u l t u r a l o r h e r i t a g e a c ti v i ti e s . T h e s e t r a v e l e r s — i n c l u d i n g v i s i t o r s t o m u s e u m s — s p e n d 6 3 % m o r e o n a v e r a g e t h a n o t h e r l e i s u r e t r a v e l e r s .

• G o v e r n m e n t s t h a t s u p p o r t t h e a r t s s e e a n a v e r a g e r e t u r n o n i n v e s t m e n t o f o v e r $ 7 i n t a x e s f o r e v e r y $ 1 t h a t t h e g o v e r n m e n t a p p r o p r i a t e s .

• T h e U . S . B u r e a u o f E c o n o m i c A n a l y s i s h a s f o u n d t h a t a r t s a n d c u l t u r a l p r o d u c ti o n c o n s ti t u t e 3 . 2 p e r c e n t o f t h e n a ti o n ’ s e n ti r e e c o n o m y, a $ 5 0 4 b i l l i o n i n d u s t r y .

• T h e n o n p r o fi t a r t s a n d c u l t u r e i n d u s t r y a n n u a l l y g e n e r a t e s o v e r $ 1 3 5 b i l l i o n i n e c o n o m i c a c ti v i t y , s u p p o r t s m o r e t h a n 4 . 1 m i l l i o n f u l l - ti m e j o b s a n d r e t u r n s o v e r $ 2 2 b i l l i o n i n l o c a l , s t a t e a n d f e d e r a l t a x r e v e n u e s .

Museums as Economic Engines

From: http://www.aam-us.org/advocacy/resources/economic-impact-statement

Economic effects of the 2013 Government Shutdown:

In October, 2013, in conjunction with the U.S. Government’s shutdown, federally run museums closed, disrupting business, inconveniencing staff and visitors, and causing a loss of millions of dollars in revenue.

Because of the 2013 Government Shutdown: The National Park Service estimates a loss of $500 million in

visitor spending, causing significant economic damage to communities surrounding national parks and monuments nationwide.

The Smithsonian Institution lost $4 million in store, theater and special events revenue.

The USS Constitution Museum (MA) was forced to close because it is located on the grounds of the Charleston Navy Yard. The museum lost more than $100,000 in donations and gift shop sales during the shutdown.

The U.S. Travel Association calculated that the shutdown cost the U.S. travel economy $152 million per day and put 450,000 U.S. workers supported by the travel industry at risk of experiencing temporary layoffs, reduced wages and decreased hours.

Paraphrased from: http://www.aam-us.org/docs/default-source/advocacy/brief-economic-impact.pdf?sfvrsn=6

Would anyone noticed if museums closed?YES

Local Impact

Museums of all sizes have an economic impact in their local communities.

This flyer, prepared by the Iowa Museum Association for Iowa Museum Week 2015, highlights some of the impacts Iowa’s museums have on the economy, workforce, and tourism industries.

Iowa museums attract 5 million visitors annually and employ over 2,300 Iowans.

But They’re Non-Profits?

Museums Build

Non-profit organizations have the unjustified reputation of not being an important economic player. Their non-profit status portrays them as institutions that have no interest in money, either theirs or anyone else’s.

But this reputation is very untrue! Museums and other non-profits are businesses, some large, some small, that need income to succeed.

In addition to their immediate economic impact, there are other ways museums blaze trails toward economic development. They educate, unite and inspire millions of visitors each year to go into the world and make a difference.

Museums Build Social Capital by communicating ideas, information and values, improving participant’s skills in planning and organizing, and improving the understanding of different cultures and lifestyles.

Museums Build and Develop Communities by developing a sense of community identity, social cohesion, development of local enterprise, facility improvement.

Museums Contribute to Social Change and Public Awareness by stimulating and developing public awareness and changing people’s attitudes on political, ethnical, religious or moral issues

Museums Build Human Capital by improving human and communication skills, analytical and problem-solving skills, creative talents, and social awareness.

Paraphrased from Museums and Impact by Carol Scott, quoting Kelly and Kelly 2000.

Ways Museums Impact Society

Investing in TomorrowMuseums of all sizes partner with schools, working with curriculum guidelines to make sure their programming is in line with national standards. By investing in youth today, museums are teaching, mentoring and guiding tomorrow’s leaders to be successful and prosperous members of society.

Museums spend more than $2 billion a year on education activities.

Museums help teach the state, local or core curriculum, tailoring their programs in math, science, art, literacy, language arts, history, civics and government, economics and financial literacy, geography and social studies.

Museums receive approximately 55 million visits each year from students in school groups.

Students who attend a field trip to an art museum experience an increase in critical thinking skills, historical empathy and tolerance.

Teachers, students and researchers benefit from access to trustworthy information through online collections and exhibits.

Children who visited a museum during kindergarten had higher achievement scores in reading, mathematics and science in third grade than children who did not.

Museums also provide social services, including ESL classes and programs for adults with Alzheimer’s. Some museums facilitate job training programs and provide vegetable gardens for low- income communities.

Paraphrased from: http://www.aam-us.org/about-museums/museum-facts School Buses parked outside Blank Park Zoo

On the Job A Ripple Effect

Museums employ more than 400,000 Americans.

Museums hire workers with a variety of skills, including: business, bookkeeping, marketing, sales, fundraising, publishing, IT, facilities management, exhibit development, law, art, human resources, housekeeping, event planning, design, food service, security, guest services, education, science, history, writing, volunteer management, conservation, retail management, preservation and more!

Arts and cultural spending has a ripple effect on the overall economy, boosting both commodities and jobs. For example, for every 100 jobs created from new demand for the arts, 62 additional jobs are also created.

Job Creation

Iowa Governor Terry Branstad signing the “Iowa Museum Week” proclamation, 2014

In ConclusionMuseums are an important part of the local, national and international economy. They employ hundreds of thousands of workers from a wide variety of industries, as well as promoting tourism and economic development.

Museums also invest in tomorrow’s economy by building communities, educating visitors of all ages, and promoting new ideas to help society grow.

For more information about museums and their impact on the economy, please visit:

The American Alliance of Museums http://aam-us.org/

The National Endowment fo the Humanities http://www.neh.gov/news/fact-sheet/neh-economic-impact

Your regional museum association: http://museumstudies.si.edu/Network1B.html

And your state museum association: https://nasmablog.wordpress.com/

Photos: Science Center of Iowa, Exhibition Guide for The International Exhibition of Sherlock Holmes, The State Historical Society of Iowa, Iowa Jewish Historical Society © Lindsey Smith