In 2008 and 2009, I worked with a lot of US-based arts organizations. And during those years, it seemed like not a week went by where I received an email that announced the demise of an organization. I frequently wondered if my workplace was next, and what was preventing us from falling into a similar fate. At that time, the ongoing recession was often blamed for the imminent closure of organization after organization. But over the past week, the same fears have started to emerge again, this time, with the cancellation of performances and seasons due to COVID-19, and a potential subsequent recession on the horizon.
By closing their doors, the arts organizations in Hamilton are doing their part to ensure that staff, patrons, artists and contract workers are able to stay healthy while the country unifies to minimize the overall impact of the COVID-19 pandemic. However, ensuring that these organizations are able to stay financially healthy during the closure- which at this point, is scheduled to last into April- is another kind of challenge.
Not-for-profit and charitable arts organizations are, by nature, fragile creatures. Performances are inherently expensive to execute, and revenues are often heavily reliant on three primary sources; government funding, private-sector support (including donations) and ticket sales. When one of these sources starts to drop, the entire pyramid can crumble.
Recently, there has been increased pressure on organizations to secure private-sector support, and in particular, donations. Part of this is due to the sweeping cuts announced last year by the provincial government. Numerous news sources (including this one) wrote about the impact to local festivals. Simultaneously, the provincial government also announced cuts to the Ontario Arts Council; an arms-length organization that provides funding support on behalf of the province to hundreds, if not thousands, of artists and organizations. This cut resulted in some organizations and artists receiving less support than before; others were held at current support levels. However, any economist will note that simply maintaining funds actually equates to a decrease, as the cost of goods and cost of living increases year over year, meaning that even if the same amount of funding is provided the following year, less can be bought with that money. Additionally, without additional funding, it can be difficult for newer artists and organizations to get the funding that they need and deserve to grow. As a result, an increased need was placed on other sources of funding- namely, individual and private support.
On March 13, as venues announced cancellations and closures of performances, the impact on the Hamilton economy was immediately clear. Thousands upon thousands of dollars will be lost in ticket revenues. This does not include the lost wages of venue staff, artistic contractors and other individuals who may be hired on a performance-by-performance basis. In short, there is no way that this will not have severe financial consequences on arts organizations, who rely on performances for a significant source of revenue. Simultaneously, op-eds are being written about how badly the arts are needed in this moment- to comfort, soothe and remind audiences that we will be together again. Arts organizations are given the obligation that they must survive, but there is a challenge in doing so.
In many of the statements announcing closures and cancellations, organizations have noted that patrons with tickets are able to donate the funds, rather than request a refund. This small gesture may end up having tremendous power to each organization, particularly as this dependency on philanthropy continues to grow. But this solution is rife with other challenges; as organizations and artists depend more and more on philanthropy, many are watching the recent downturn of the stock market. The recovery- or subsequent recession- will impact donors, their ability and capacity to give.
With no definitive end to the closures, cancellations and postponements to performances and seasons, organizations and artists are facing the loss of significant revenue in the short term. However, the risks of closing can go beyond the short term. It can take years for organizations to build back audiences following this type of interruption, as once some patrons break their habit of regular attendance, they stop going completely, or become more sporadic in their attendance. In many cases, organizations “right-size” themselves to reflect their decreasing audience by shifting to a smaller venue or shrinking programming. In other cases, the result is the closure of the organization.
What is unique about the current climate, and different than ten years ago is that very few live entertainment options are currently open. Historically, there have been alternatives- when the Hamilton Opera closed several years ago, the Hamilton Philharmonic stepped forward to honour season subscriptions. Today, with very little alternatives existing, there may be a surge in interest in attending live events once recommendations are lifted and performances begin again.
Artists and arts organizations in Hamilton are exceedingly resilient- there’s more than one reason why the phrase “Art is the new steel” was coined several years ago. Hamilton, like many cities reliant on industry knows that the success of a season or performance can be tied to external factors- like how well the local industry is doing, for example. In this way, local artists and arts organizations are perhaps some of the best prepared for what may lie ahead in the coming months and years as they attempt to recover from these closures.
Stages may currently be dark, but it won’t always be that way. Within a few weeks, we hope to see lights back on and full houses of enthusiastic audiences. But to fully recover and continue the momentum that many organizations and artists had just a few weeks ago will take more than just buying a ticket. It will take support of the organizations and artists we love through volunteerism, through financial support and through encouraging others to share in the joy that we know to be the live performance. The arts will continue to comfort, soothe and remind audiences that we are together again; but now is the time for us to comfort, soothe and remind the arts that they will continue to be essential to our community.