Reports Estimate Cost Of COVID-19 To Arts Will Be Steep, Especially For Music Venues

Two new reports estimate that Colorado’s creative industries have shed almost 30,000 jobs between April and July of 2020, along with more than $1.4 billion in sales revenue due to the COVID-19 crisis. Most of that has been in music, theater, dance and visual arts, which lost more than half of all jobs and more than a third of its sales revenue.

Among that group, the most visible losses have been to the live music scene, said Michael Seman, an assistant professor of arts management with Colorado State University’s LEAP Institute for the Arts. Seman is the author of the 2020 City of Denver Creative Economy Reportand Initial Impacts of the COVID-19 Crisis on the Music Industry in Colorado and the Denver Metropolitan Region.

The reports are a collaboration between LEAP, Denver Arts & Venues and the state-run Colorado Creative Industries.

Seman says while the estimates seem stark, they are conservative, especially with so many unknowns even pre-COVID.

“In so much of the music industry the economics of it isn’t recorded because people are being paid in cash, people trade services here and there, so there’s a lot that’s ‘off-the-books,’” he said.

Those working on the recording side are somewhat protected because people are still buying music, he added. While it doesn’t replace the income they’d generate through live shows, musicians can do virtual or drive-in concerts or pivot to teaching music classes online.

But if you’re a venue owner, there’s really no place to pivot, Seman said. That puts them in the most critical situation.

It’s estimated that the state’s music scene has lost more than 50% of its jobs and a quarter of its annual sales revenue, according to the reports. And these losses don’t just impact venue owners and musicians, said Seman, calling venues “entrepreneur incubators.”

“You have these bands that are coming up (and) they’re learning how to be a band, which is basically learning how to run a small company,” he said. “But then, for example, you also have people that make the t-shirts for the bands that then become actual companies working on merch. So it’s a thing that shouldn’t be overlooked.”

Venues are also places for necessary community building, Seman added.

“They’re great for building social cohesion, community and they’re strong anchors for a lot of communities,” Seman said. “In many areas, one venue can be a hub where you have people — artists, filmmakers and musicians, but also teachers, doctors, lawyers — they all can gravitate around venues. So by losing them we’re not just losing a place for live music, we’re losing a place for community to develop.”

There’s also the ripple effect to businesses that are physically located around venues.

It’s common for people coming out for a show — particularly if they’re coming from out of town or out of state — to make an event around it, booking a hotel, eating at restaurants, going to museums or shopping, Seman said.

That impact is already beginning to show up with the recent closure announcement of Denver’s Rialto Cafe. Owners of the longtime business on the 16th Street Mall noted that without traffic from concerts and nearby events as well as from tourists, they just couldn’t stay afloat.

Seman said music venues will struggle the most to rebound from this crisis.

The National Independent Venue Association estimated that without substantial relief funding, 90% of music venues across the country will go out of business after six months. The pandemic is well into month five.

“It’s not rocket science,” Seman said. “It’s not hard to understand the critical situation that they’re in, and honestly I don’t foresee live music coming back in the capacity that audiences would have to be there to make it a financially sound proposition for a venue — I don’t see it happening until sometime in 2021.”

The industry is beginning to see some of those permanent closures. Most recently, the longtime Fort Collins venue Hodi’s Half Note shut down. The new owners hope to reopen the longtime concert venue as a comedy club next year.

Red Rocks isn’t going anywhere, Seman said. It’s the small, independent venues that are most at risk.

While there are some state and local efforts to help those in the industry, including the Colorado Music Relief Fund, it’s legislation such as the Save Our Stages Act and the ReStart Act that will be essential, he said. The relief bills would offer those in the music industry — including venue owners, producers and promoters — grants and also give more flexibility in Paycheck Protection Program loans.

“What we’re in danger of — the longer this goes on — is the infrastructure will start to erode,” he said, referencing not only the physical buildings, but the human capital that’s been built over decades such as sound and lighting designers, promoters and managers.

“It could be years honestly until we could get back to where we were with all the venues we have — big and small,” Seman said. “But, that’s an estimation, you know. It’s my first global pandemic.”

Not wanting to end things on too stark a note, Seman added that there is a lot to be hopeful about as well.

“Musicians and people in the music industry are some of the most creative people in the country and if there’s one group of people that will figure out a way to survive and continue and keep bringing music to people, it will be musicians,” he said. “So I have faith that things will go in the right direction.”