As of March 23rd, much like the other global-hubs, the United Kingdom found itself cautiously stepping into a national lockdown, designed to stay the spread of the Covid-19 virus.

Chief among the concerns of the government officials and critics, alike, was the threat that this action would pose to the UK economy, and the millions of livelihoods that depend on the continuation of a viable and buoyant economy.

The Arts & Culture sector, like many others, was facing a period of uncertainty, which would undoubtedly present the many businesses and organisations across the sector with difficult choices, pertaining to the future viability of the sector as a whole.

In endeavouring to gather insights and information relevant to any future assessment of the impact that the events of 2020 have had on the Arts & Culture sector, I first intend to accrue and collate a range of secondary research materials, including, but not limited to existing case-studies. My response to which, is included, below:

OECD: Culture shock: Covid-19 and cultural and creative sectors.

The Organisation for Economic Co-operation and Development is dedicated to the advocation of best practice and the rights of individuals across a membership of 37 countries, that collectively represent 80% of the worlds trade and investment.

Through collaboration, the membership strives to identify and resolve the most pressing challenges facing the international community, today. And has, throughout 2020 been involved with responding to the emergence, and subsequent impact of, the Covid-19 pandemic.

As of May 2021, the key trends to emerge, and which had become a priority for much of the international community in recent months, are: Public Health Strategies, The rate of the vaccine rollout, Fiscal and monetary support, and the importance of hard hit sectors. All of which not only contributes to the disparity between the progress of the response throughout the international community, but also poses a number of challenges for the UK, going forward.

The current restrictions on flights, and a significant decline in the tourism sector has further burdened the recovery in many countries, specifically in those regions that are reliant on the revenue generated by the tourists that do visit each year, with Iceland and Spain being two of the most effected countries. With the current projections for a return to a pre-covid economy in Europe being Three years.-Currently, America and South Korea are already observing a pre-pandemic, per capita income. And many South American countries are estimated to reach a similar point in their respective recoveries within Three-to-Five years, at the current rate of progress.

With a revised projection for global growth in 2021 now being 5.8%, up from the 4.2% projected back in December 2020, by the close of 2022 there is still, a predicted shortfall of 3 Trillion USD.-The size of the French economy.

The UK is currently leading the way in the volume of doses administered per 100 people, with 90 in every 100 people having received at least a single does of the vaccine. The United States follows close behind, with 86 people in every 100 now having received at least, a single dose of the vaccine. Regrettably, there is a considerable disparity between the two examples given at the remaining countries, with Europe lagging far behind both the UK and the United States. Germany, the most effective of the European countries in the rollout of the vaccine, had by the 21st of May 2021 only managed to administer at least one dose to 54 people in every 100 people. In providing both context and a contrast to these figures, South Africa and India had by the same date, only managed to administer the same dose to 1 and 14 people in every 100 people, respectively.

In relating these insights back to my project proposal, I should like to direct the readers attention to the impact such shortfalls do, and will have, going forward on the viability of an economic recovery within the UK, specifically when discussing the future of the Arts & Culture sector. And many of the programmes that do exist across the sector, that not only enrich the cultural heritage of the UK, but also contribute to other aspects of the country’s role on the international stage, are also at risk of becoming defunct. Thereby risking the destabilising of the delicate balance that is often observed in the field of international relations.

To illustrate this point, I would suggest that the reader consider the role of our national galleries and how through an international network both trade and political agreements are secured through the returning of artefacts, or the loaning of collections.

The Arts & Culture sector has seen a considerable decline in GVA (Gross Value Added) during the pandemic, largely due to a severe decline in foot-traffic within organisations. The effort to attract visitors was also impacted by the implementation of government policies, such as the Tier-system.

With the announcement of the £1.57 Billion support package the Arts Council England were allocated £825 Million, with the remainder of the sum being managed by the Government. The Arts Council had decided that the best way to distribute the funds would be to do so subject to the needs of the respective organisation, and therefore they have categorised the funding options, as follows:

Recovery grants;
Repayable finance; and
A Cultural Kickstarter fund.

GVA for 2021 is expected to reach £12.850 Million, expected to return to a pre-Covid level of £13.890 Million, in 2022. By using this model the sector is set to return to a rate of growth of 3.4% per annum, with GVA increasing to £15.230 Million, by 2025.

The hardest hit sub-sector is Music, Performing, and Visual Arts, which has seen a GVA loss of £2.280 Million.

The nature of the industry makes it more susceptible to lockdown
than others partly due to a lack of ability to transform physical spaces, landmarks, and
attractions into commodities that can enter the online marketplace.

The impact of the cultural recovery fund on the Arts & Culture sector, CEBR.

Art Basel & Affiliated Events

In response to the impact of the pandemic, the organisation has hastened efforts to further utilise digital platforms in the delivery of content, placing a greater emphasis on consumer-engagement.

_{According to Noah Horowitz, Art Basel Director, Americas, ‘As the industry faces the implications of a coronavirus-driven global downturn, it will be especially insightful to see what strategies win out in this rapidly changing landscape, and especially what role online sales avenues will play in connecting sellers, buyers, and all sorts of intermediaries.’}

In 2019, like much of the Art Market sector, the organisation had to adapt to a number of unfolding events that included both the US/China Trade-war, and the impending arrival of Brexit. Both shifts had presented multiple threats to the Art Basel programme, along with the presenting a myriad of obstacles for its’ affiliated events: Presenting an array of challenges that would impact the viability of such events in the future.

_{‘Even in the best of times, running and successfully growing a gallery can be a challenging proposition,’ Horowitz continues. ‘Steadily rising costs, increased regulations, and limited access to external capital have placed elevated financial strains upon many such businesses. But galleries are nimble, and will no doubt continue to find innovative ways both to support their artists and to service their clients.’}

As Mr Horowitz alludes to, there are a great many obstacles for those individuals looking to build and grow a business within the Art Gallery Sector, and when we consider the economic strains placed upon the sector by the pandemic, it is reasonable to assume that the viability of remaining operational is become increasingly unlikely, for many of the smaller galleries, specifically those in regions that are outside of urban-hubs, such as London.

With the events continuing to cause anxiety among buyers, and presenting an uncertain prospect for potential investors in the sector, some organisations, such as White Cube sought to expand their overseas operations in an effort to broaden their consumer-base. The year 2019 had also seen the Auction market contract some 17%, even though many of the sectors dealers had seen growth in that period.

In reflecting of this shift, I am inclined to propose the notion that there is now a far greater need for innovative thinking in the development of the Art Gallery Sector, with Digital Tools now becoming more widely used by the galleries, and the sector as a whole. There are also questions arising around the use of traditional business models, with evidence to suggest that there is a decline in the attendance of on-site auctions, with consumers preferring to view and buy Artworks via online-platforms.

Jose Juri, a gallery owner from Mexico city with a newly established office in New York conveys her belief that one of the challenges facing the sector is that of finding new buyers.

_{we have lost several serious patrons of the arts, like [Chicago-based collector] Stefan Edlis. We all need to encourage a new generation of deep collectors like them.}

In my view this is one of the most important questions that needs to be explored, and in the course of endeavouring to find the correct response, will present the sector with the need to pivot and make fundamental changes to both which segments they target, and how the engage with the consumer.-A point even more detrimental to those galleries operating outside of the top tier, due to their lack of existing opportunities.

BICS

BICS (Business Impact of Covid-19 Survey) reaffirms the fact that the Arts, Entertainment, Recreation (AER) sector has been the most severely affected sub-sector. With organisations finding it difficult to pivot in order to accommodate an ever-changing economic landscape. Thirty percent of businesses in this sub-sector report a fifty percent decrease in turnover when compared to the same period in the previous year. With an increase in trading being reported for the period between July and August, when government restrictions had been eased and some organisations had been able to reopen, if only in the guise of a partial opening with limited capacity.

In observing the challenges that are faced by this sub-sector, and the Arts & Culture sector in general, it would be accurate to assert that one of the key questions that requires answering is; How do the organisations that are reliant on foot-traffic pivot in order to respond to the on-going situation, pertaining to the governments’ lockdown-measures?

Art Gallery Sector:

_{And, in contrast to 2018 – where the highest-end prospered most – the report shows that galleries with annual sales in the $250,000 to $500,000 and $30 million-plus ranges both made substantive, double-digit gains.}

_{Those championing equity and diversity in the market will find a bright spot in the report: female artists made serious strides in gaining a foothold in primary-market galleries, those that represent artists (and estates) directly.}

_{While women still lag behind men, especially in the top tier of galleries, McAndrew’s report documents an uptick of some 8% year-on-year in the female percentage of their rosters, to a record 44%.}

There is a need to seek-out new buyers, new markets, and to reassess the communication methods that are employed by galleries, in engaging with their respective buyers.

With traditional buyers choosing to withdraw, and the emergence of new markets playing a more important role in the identifying of market-trends, it is evident that those galleries operating on the international stage must now consider a much broader set of insights, in the creation and development of their Marketing Strategy. Chief among such considerations is that of regional value, and the role of cultural trends in the developing of Taste-Making. The value of this factor has been demonstrated in recent years by the emerging, and subsequent rise to prominence of the online-streamer, whose contributions can now be valued in the millions of dollars.