The creative economy and the arts have huge potential to contribute to our economic, cultural and social wellbeing. But their needs and potential are not fully understood by policymakers and by those who fund and support innovation. As a result, they are often undervalued.
Our work in this field since 2009 has aimed to show the value of the creative economy and to grow this value. Between 2017 and 2020, we followed three main strategies to achieve this.
Over the last decade, we’ve shown the value of the creative economy, influenced policies to help it grow, and helped arts and cultural organisations thrive by making the most of digital technologies and new funding sources.
Our research has aimed to demonstrate why the creative industries are such a crucial point of competitive advantage, and how policymakers and governments can best amplify this.
From 2018, we did this through the Creative Industries Policy and Evidence Centre (PEC). Its independent research provides authoritative recommendations to inform policy. Led by Nesta, and funded by the Arts and Humanities Research Council, the PEC is made up of 10 universities from across the UK. It brings together the best researchers to answer the most pressing questions about the creative industries.
Our research is regularly cited by MPs, ministers, civil servants and advisors in Government. For example, our work calling for a revision of current definitions of R&D, to recognise the needs of sectors including the creative industries, has been discussed in Parliamentary debates and influenced the commitment to a government-industry working group in the Creative Industries Sector Deal. The 2019 Conservative manifesto also announced a review of the R&D definition for tax relief purposes. Our policy ideas, such as establishing a freelance visa and abandoning salary as a measure of skill level, have been raised in debates in both the House of Commons and House of Lords.
In the UK, London and the South East dominate the creative industries. We analysed in detail this regional imbalance in our report, Mind the Gap, by the PEC’s researchers at the University of Manchester. Our evidence showed the scale of investment needed outside the South of England if the UK is to address the regional imbalances in productivity.
From 2012 to 2015, the £7 million Digital R&D Fund for the Arts helped 53 arts organisations to use digital technology to build new business models, and enhance audience reach and engagement. The results showed that many organisations were particularly interested in social media, and that the value of risk-taking outweighs the negative feeling around ‘failure’.
In 2016, we launched the Digital Arts and Culture Accelerator to explore whether a tech accelerator model can transfer into the arts and cultural sector. Nine organisations previously backed through the Digital R&D Fund for the Arts participated. We found that an accelerator model is not a replacement for public funding; and is not relevant for arts and cultural organisations which are not in the business of generating products of commercial value. The work opened up a conversation regarding how arts and cultural organisations can diversify their income streams.
Alongside these experiments, Nesta supported hundreds of arts and culture organisations, from community art spaces to nationwide festivals, by developing new funding options and using digital technologies to create new artforms and reach new audiences.
One of these organisations was InHouse Records, the world's first record label to be launched in prison, created by prisoners. It’s more than a record label though: it’s a social enterprise that rebuilds lives through music-based training. We provided InHouse Records with an impact loan to help them boost both their resilience and capacity so they can generate even greater social impact.
[Repayable finance is] not something that was widely available in arts and culture, and now it is. It means that these organisations have a whole other financing tool that they can consider.Francesca Sanderson, Director of Arts Programmes and Investments, Nesta
We rolled out similar repayable loans to over 30 organisations through our Arts & Culture Finance initiative, delivered in collaboration with many great partners. Since the launch of the Arts Impact Fund in 2015 Nesta has made over £33 million available to arts, culture and heritage organisations in the form of impact funds providing repayable finance, through launching the Cultural Impact Development Fund in 2018 and the Arts and Culture Impact Fund in 2020.
As well as needing financial support, arts organisations like theatres, orchestras and museums need to harness digital technology to enhance their social impact. That’s why we made grants, support and mentors available to charities like Accumulate through our Amplified programme from 2018 to 2020. Accumulate offers a podcast-based training programme to young, homeless people so they can develop their confidence, digital knowledge and skills.
To grow the creative economy, we need to understand what drives growth and what inhibits it. To that end, we developed a hub for quantitative research on the creative economy, using innovative techniques like network analysis, machine learning and interactive data visualisation to help us uncover untold stories.
The creative industries should be as diverse and inclusive as possible, but we know imbalances do exist and we have used big data to draw insights. With the PEC, we examined half a million articles in the media, and our research, She Said More, revealed a stark gender imbalance in reporting on the creative industries, particularly in areas like technology and games.
She Said More: Measuring gender imbalances in reporting on the creative industries
Explore our data visualisation
Our work also focuses on capturing the value of arts and culture in order to prove how crucial they are to our economy. We used economic valuation techniques to measure the value of historic cities, cathedrals and museums. As a result, Arts Council England commissioned us and the Creative Industries Policy and Evidence Centre to work with arts and cultural organisations to build their capacity to use these techniques.
We wanted to build a clearer picture of how the creative industries contribute to local economies too. Through pioneering data-mapping techniques, we revealed how different locations across the UK follow different paths to creative growth, meaning what works in one place might not work elsewhere. Our findings influenced the AHRC-funded Creative Industries Clusters Programme, an £80 million investment to grow the creative industries through research and development.
In 2019 we launched Alternarratives, a short story prize aiming to bring the artform into the 21st century and help young people rediscover the joy of reading. We wanted to unearth the future of cutting-edge, short-form storytelling, encouraging writers based in the UK to think beyond the ‘document’ and use all the tools at their disposal to tell stories in new and exciting ways. In its pilot year, nine creatives were awarded R&D funding and mentor support.
At a time when all jobs, whether in a coffee shop or bank, can seemingly be described as ‘creative’, you’d be forgiven for thinking the word had lost all meaning in the labour market. However, in a study of 35 million job adverts between 2013 and 2017, we found that creativity is still listed in a relatively small number of job adverts (for roles which we would independently judge to be creative) and, importantly, is much more likely to be a requirement in occupations that are predicted to grow.
Our partnership with the British Council on the Creative Enterprise Programme inspired more than 650 new creative and social entrepreneurs in 32 workshops across 13 countries. We also carried out a full review of our evaluation process to improve how we measure the economic impact of our programmes. We joined forces with Hivos to co-develop Creative Hubs Academy, a learning programme which was piloted in five countries. This programme helps leaders build sustainable business models and services that are more impactful and responsive to their community’s needs.
Research by the Nesta-led Creative Industries Policy and Evidence Centre examined half a million articles in the media, revealing a stark gender imbalance in reporting on the creative industries, particularly in areas like technology and games. Our visualisation and analysis of the resulting data won a silver award in the People, Language & Identity category of the 2019 Kantar Information is Beautiful Awards.
Our work to demonstrate the economic and social importance of the arts and creative economy resulted in the first Sector Deal for the creative industries as part of the Government’s industrial strategy. The Sector Deal is investing more than £150 million across the lifecycle of creative businesses, including funding leading creative clusters to compete globally, research into augmented reality and virtual reality, and a careers programme that is opening up creative jobs to people of every background.
We’ve rolled out repayable loans to over 30 organisations so far through our Arts & Culture Finance initiative, delivered in collaboration with many great partners. For example, we’re supporting The Story Museum to enrich children’s lives through the power of stories, while improving its financial sustainability and resilience. With the help of a £400,000 loan, the museum is expanding its premises, allowing it to welcome more visitors and reach more disadvantaged families in the community.
Our investments have supported the creation of 10 new arts venues. This includes performance spaces as well as facilities for the public to be involved with creativity, either as spectators or participants. We have also supported the creation of an artist residency programme in the south of France, a record label working in prisons and a 3D interactive programme that preserves the voice of Holocaust survivors.
Findings from our research on the importance of creative clusters influenced the design of the Arts and Humanities Research Council-funded Creative Industries Clusters Programme, an £80 million investment to grow the creative industries through research and development. The programme brings together world-class research talent from across the UK to accelerate growth in a range of creative sectors. The aim is to create jobs and drive the creation of companies, products and experiences that can be marketed around the world, significantly contributing to UK economic growth both regionally and nationally.
Find out more about the Creative Enterprise Programme, delivered through our partnership with the British Council, in the video above.
Our policy and research work on the creative economy has created an evidence base for policymakers including on how important the sector is. We have been able to demonstrate both the economic and social impact of the creative economy, and more targeted research has highlighted challenges around access to skills, trade, immigration, research and development and more.
Despite the size and growth of the creative economy we have seen that it is still undervalued and misunderstood in many areas of policy, leading to inadequate support. During the COVID-19 pandemic, for example, self employed people working in the creative industries struggled to access many of the support offerings from the government.
We’ve found great success in bringing together organisations in the creative economy who would never normally collaborate with each other. For example, in our Immersive Fellowships in Mental Health programme, we paired four talented creative companies with experts in depression, emotional processing and family mental health from Royal Holloway University to develop and build immersive technology experiences with the potential to positively impact people's mental health.
Our impact funds have taught us that repayable finance can and does have a place in the arts, culture and heritage sectors, as well as the broader creative economy, and can even help to bridge the divide between subsidised arts and the commercial creative industries. We aim to help many more organisations understand and develop their assets, and expand and redouble their positive social impact.
I would love us to carry on working to understand how best to be a connector, a convener, and a marketplace expert on the things we’ve been working on - new business and funding models, audience evolution, reaching audiences, positive impact and more experimentation. Helping organisations and people understand how to evolve.Francesca Sanderson, Director of Arts Programmes and Investments, Nesta
It’s difficult to say how the future will pan out for the creative industries following the COVID-19 pandemic, but we must be sure that they’re able to ‘build back better’. To us, that means diversifying the sector and ensuring that recovery is innovation-led and spread across the whole UK.
We want the creative economy to be understood, not just by the policymakers who work directly with it, but right across government—and we want policy initiatives to take account of evidence which demonstrates what this world-leading sector needs.