California’s creative economy packed a massive punch in 2015 — a wallop that supported 747,600 direct wage and salary jobs and generated $406.5 billion in economic output.
That’s just one of the highlights of the 2017 Otis Report on the Creative Economy of California, which was released Thursday. The Otis College of Art and Design commissioned the Los Angeles County Economic Development Corp. (LAEDC) to create the study.
Creative economy — a definition
So what, exactly, is the creative economy?
The definition can be somewhat fluid depending on who you ask. But for purposes of the Otis report it’s made up of a variety of industries that include architecture, interior design, entertainment, fashion, toys, publishing and printing, visual and performing arts providers, industrial design services, digital media and fine and performing arts schools, among others.
And the ripple effect spreads well beyond those 747,600 direct wage and salary jobs. When indirect and induced jobs are added to the mix, the Golden State’s creative economy supported more than 1.6 million jobs in 2015.
Indirect jobs include workers who don’t directly produce goods or services but make their production possible or more efficient. A supplier that provides wood to a furniture maker would fit that category, for example, or a company that makes equipment used in the production of toys.
Induced jobs take into account employees who work at local restaurants, gas stations, supermarkets and other businesses where creative industry workers spend their money.
Los Angeles area key to state
The Los Angeles region accounts for a big chunk of the state’s creative economy. It fueled an economic output of $190.3 billion in 2015 and it generated 759,000 direct, indirect and induced jobs for workers who collectively earned $56.9 billion.
Those jobs fueled $8.2 billion in tax revenues tied to property taxes, local and state personal income taxes and sales taxes directly and indirectly generated by the region’s creative industries.
Fashion industry is ramping up
Ilse Metchek, president of the California Fashion Association, said her industry plays a bigger role in Southern California’s economy that many might think. The Los Angeles-based trade group represents manufacturers that produce fashion apparel.
“At any given time, there are about 30,000 people working in the entertainment industry and the rest are laid off and looking for work,” she said. “But we have over 180,000 people working every day in our industry. And it’s not people hunched over sewing machines. Our industry involves high-tech, 3-D, artificial intelligence and robotics. We’ve moved into the 21st Century and we don’t look back.”
Figures from the California Fashion Association show that the value of Los Angeles-area apparel and textile shipments totalled $42 billion in 2015, up from $39.5 billion in 2014 and $36.8 billion in 2013.
Direct wage, salary jobs rising
The Otis report shows that California added 88,600 direct wage and salary jobs between 2010 and 2015, an increase of 13.5 percent. The job count is expected to hit 760,400 by 2020, bringing it closer to the 2007 pre-recession peak of 767,000 jobs.
“We consider ourselves to be in a post-industrial economy,” LAEDC economist Kimberly Ritter-Martinez said. “This whole idea of innovation being a driving factor has grown to include the concept of creativity. We don’t talk a lot about technology in this report but technology and creative industries are very much related.”
The creative industry that displayed the highest employment growth during the 2010-2015 period was digital media, which grew by 37.7 percent. That was followed by publishing and printing (up 27 percent) and architecture and interior design (up 23 percent).
The report also notes significant growth among self-employed Californians who work in the state’s creative industries. In 2009, they numbered 285,182, but that rose nearly 20 percent to 340,567 by 2014. The top sectors for growth among self-employed workers are visual and performing arts, communication arts and entertainment.
All told, creative industry workers accounted for 11.8 percent of all of California’s private wage and salary workforce in 2015. And all of that output generated $16.7 billion in local and state taxes.
On a broader scale, California has outpaced the nation in both economic growth and job creation over the past few years. It led the nation in jobs in 2015 with total wage and salary employment of nearly 14 million.
Wages are on the higher side
The report also shows that many of the jobs in California’s creative industries pay well.
In 2015, the average annual wage for someone in architecture and interior design was $80,715. In communication arts the average was $89,447, and the average annual pay in a variety of other industries — including toys, entertainment, visual/performing arts, publishing/printing and digital media — was $90,000 or more. Digital media posted the highest average yearly wage of $206,545 and publishing/printing jobs averaged $205,545 a year.
“When you dive deeper into the report with education levels you’ll see that many good jobs require a bachelor’s degree,” Ritter-Martinez said. “But there are a number of occupations that don’t require a college degree, maybe just high school and a couple of years of community college. And they can still earn a wage that’s higher than the median income in Los Angeles. That can provide the pathway to a middle-class lifestyle.”