New York's Music Business Drives $21 Billion Annually, Study Shows
New York isn’t just the music capital of the world -- its music business generates plenty of capital. That’s the upshot of an economic impact study just announced by Mayor Bill de Blasio and Media and Entertainment Commissioner Julie Menin. The report, by Boston Consulting Group, says that the city’s music business supports almost 60,000 jobs and $5 billion in wages -- and that it drove $21 billion of overall economic value in 2015, the year for which the data was surveyed.
"The point of this report is to focus on what city policies we could enact to create additional opportunities," Menin says. "I thought it was important that we first understood what the music ecosystem looks like because that would help us."
For years, New York City has encouraged film and television production, which provides jobs and stimulates the local economy. (Any tax incentives come from the state level.) But when de Blasio appointed Menin last February, he added music, advertising, and digital media to the portfolio of the Mayor’s Office of Media and Entertainment, which already oversaw film, television and theatre. This summer, Menin began reaching out to the city’s music business with a "town hall" attended by about 75 music executives in various sectors of the business. In a separate but related effort, Menin’s office is in talks with the Recording Academy to bring the Grammy Awards to New York in 2018, a deal that sources say is all but completed.
"We had traditionally done studies about film and television but we hadn’t ever done one about music," Menin says.
The study identifies four important aspects of the city’s music business, one of the largest in the world: local artist communities (including smaller venues and rehearsal spaces), mass music consumption (larger venues, radio stations, and retailers), the global record business (labels, publishers, and managers), and infrastructure and support services (recording studios, lawyers, and various other professionals). Unsurprisingly, mass music consumption contributes the most to the economy -- half of the industry’s economic output, according to the report. The overall live business is big as well: New York City concerts sold more than 5.4 million tickets in 2016, more than three times as many as were sold in Los Angeles.
New York is also host to more than 70 digital music companies, more than any other city.
The report is intended to spur discussion about ways city government can help grow the music business, and it suggests four areas of opportunity: Supporting artist communities, creating more performance opportunities, increasing the economic impact of music consumption, and expanding the number of digital music services. The first two have been impacted by gentrification, which has raised rents for venues and rehearsal spaces and brought noise complaints to neighborhoods where they were unknown a decade ago.
In addition to data, the report draws on the expertise of more than three dozen music executives, including Universal Music Group EVP of public affairs Eric Berman, Glassnote Entertainment Group founder Daniel Glass, and Downtown Music Publishing CEO Justin Kalifowitz.
"At the town hall," Menin says, "we heard from music venues that they wanted an expeditor to help them navigate various city agencies" -- the kind of work the Media and Entertainment office does for film productions. And while Menin’s office can't bring inexpensive rehearsal space back to Williamsburg, "We believe that New York City is the music capital of the world," she says, "and we would like to help the business here grow."