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So a week ago we were at the Americans for the Arts conference, listening to Peter Senge talk about a sustainable vision for the arts. But being a pragmatic type, we also dropped in at the Grantmakers in the Arts session on arts funding projections.
It was grim. Polling of grant funders revealed that they'd lost about twenty-two percent of their assets in 2008 and forecast losing another ten percent in 2009. Because they base their funding on rolling three-year intervals, artists and arts organizations can look forward to seeing the impact of these losses in 2011 and 2012 (in addition to an immediate ten-to-twenty five percent decrease in individual giving this year). God help you if you're a new organization, or are looking for funds from new sources, because the prevailing wisdom was that funders weren't looking for new opportunities.
The presenters--Janet Brown from Grantmakers in the Arts (the GIA Summer 2009 Reader is available for download); Sue Coliton from the Paul G. Allen Family Foundation; Marian A. Godfrey with Culture Initiatives at The Pew Charitable Trusts; Fidelma McGinn, of Artist Trust; Tommer Peterson from Grantmakers in the Arts; and Holly Sidford of Helicon Collaborative--had to struggle to find upbeat approaches to the research. About the only thing they could find is that things were tough all over--and to date, arts funding hasn't suffered more than any other philanthropic area.
But here's the most important finding, to reward those of you reading this far down: While it may take five years to climb out of this current recession, this crisis is masking the effects of a five-to-ten year shift in philanthropy in response to the global economy. It's not that the well has gone dry, necessarily, but it's being decentralized and outsourced where possible. Foundations are cutting back on staff, and looking more closely at collaborative funding and even microloans--some are even developing "sunsetting" funds up so that failing arts groups can go out of business gracefully.
Looking at it from a reverse angle, you can see the broader economy in Washington artists' responses to an Artist Trust survey about their needs. Health insurance was top of mind (along with job insecurity, since many working artists have health insurance through their spouse), but also on their list was the expense of supplies (visual artists have to make a substantial outlay before they can hope to recoup through sales), lack of venues (galleries and theaters have been closing), and the need for business training (mainly in marketing/promotion and social networking, as traditional media ceases arts coverage).
The majority of Washington arts organizations are opting for an austerity regime, and hoping to outlast the downturn (about fifteen percent still think things will turn around in a few months because they have to), while a nimble twenty-five percent are proactively responding to conditions as they exist. They are focusing narrowly on their mission, emphasizing their connections to their communities, and shifting the priority to more "audience friendly" programs--or finding friendlier audiences. Staffing is skeleton-crew, any capital-intensive projects are on hold, and a wholesale shift to online communications is underway, with print almost abandoned.
In the background to all this is the overall demographic shift the arts have been struggling with for a decade or more (to put it crassly, the graying of white people), changing audience behaviors and desires (e.g., "Where have our subscribers gone?"), and the growth in "passion"- and results-oriented philanthropy (as contrasted with staid, pillar-of-the-community giving).
The takeaway was more or less that if an arts group was struggling before the economy went south, it would either need to reorganize or close. The recession is holding arts organizations' feet to the structural-realignment fire, and asking them--and their funders and audiences--what matters most. In our limited experience, this is exactly the question the old non-profit model ensured would get asked least.
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