TWO THIRDS OF INDUSTRY JOBS (79,000) LOST, $23.6 BILLION OF ECONOMIC OUTPUT LOST, $10.7 BILLION OF ADDED VALUE LOST
Melbourne and Sydney (14 October, 2020) – The Live Entertainment Industry Forum (LEIF) has asked the Federal Government to urgently consider targeted measures to provide additional support to the live entertainment sector as a new report by EY lays bare the devastating impact of COVID-19 restrictions on the industry and the livelihoods of the people who work in it.
Preliminary findings from The Economic Cost of COVID-19 on Australia’s Live Entertainment Industryreport quantify for the first time the total economic output of live entertainment in Australia, at an estimated $36.4 billion in total contribution in 2019.
EY estimates that COVID-19 has led to a fall of 65% in the economic output of the industry to $12.8bn in 2020 if restrictions remain in place until the end of year. This equates to $23.6bn in lost economic output. Likewise, the total value added by live entertainment is predicted to fall by 65% from $16.6 billion in 2019 to $5.9 billion in 2020, a fall of $10.7 billion.
The preliminary findings from the report, which will be released later this month, show that the sector supported 122,000 full-time equivalent jobs in 2019, and forecast that in 2020 this will fall two-thirds – or 79,000 – to just 43,000 full-time equivalent jobs if current restrictions on gatherings remain in place until the end of December this year.
LEIF, which represents Australia’s largest live entertainment employers, said that it is grateful for the support provided to the industry to date but added that the new data shows urgent ongoing and additional government support is essential to prevent further job losses and lasting damage to the sector. LEIF has recommended industry specific initiatives that include:
- Continuation of a JobKeeper-style support program for employees in our industry until such time as the live entertainment industry returns to normal operation and without the constraints of major restrictions
- A moratorium on GST on live event tickets, following the precedent set in the UK
- An industry-led Live Entertainment Business Interruption Fund underwritten by Government; and
- A significant expansion of the RISE grant funding program, with a particular focus on assisting commercial, non-subsidised live entertainment operators to deliver popular live events in COVID-safe formats.
Importantly, live entertainment industry leaders have reiterated their commitment to working in collaboration with Governments and health authorities across Australia to ensure the re-opening of COVIDSafe events as restrictions ease.
James Sutherland, Chair of LEIF, said: “The Federal Government is understandably focused on jobs. This vitally important report shows that our sector, which normally supports 122,000 full-time equivalent jobs, has lost nearly two-thirds of those jobs this year.
“JobKeeper has provided a lifeline for our sector, but the prospect of it disappearing in March 2021 – when the industry is likely to remain massively inhibited by key pandemic-related restrictions – is of grave concern to all industry operators. For our sector to operate profitably we require venues operating at full capacity, unrestricted interstate movement, and open international borders without extensive quarantine. Without those necessary conditions, the outlook is truly bleak.
“Given the long route to recovery, and the nature of lasting restrictions, we believe that an industry extension to JobKeeper is a fair and important next step.”
Matt Colston, Associate Partner at EY and Asia Pacific Leader of EY’s Sports, Events and Venues Advisory said: “Live entertainment is a huge part of the Australian culture. Through our work with the Live Entertainment Industry Forum, we know that the industry has been severely impacted in 2020 as a result of COVID-19. We have also been able to demonstrate just how important a vibrant Live Entertainment Industry is to our economy, contributing over $36 billion in 2019 and employing an estimated 122,000 people.”
Geoff Jones, Chief Executive of TEG, said: “EY’s report demonstrates that when the live entertainment industry does badly, Australia loses. Almost all of our revenue disappeared overnight when COVID-19 restrictions closed down the industry in March and while the return of sport with limited capacities has offset some of that impact in EY’s figures, for commercial live entertainment operators both large and small, revenue in September/October remains at no more than 10% of 2019 levels.
“A simple, targeted action that will do a great deal to help our industry is a moratorium on GST on sales of tickets to live entertainment until 30 June next year. This will help us to offset the increased costs we are incurring to make our events COVID-Safe.”
Mr Jones stressed that despite the tough outlook, pent-up demand for live entertainment is huge: “More than 80% of people have held onto tickets for postponed shows during COVID. Australians have cabin fever – they want to entertain themselves, get the kids out of the house, and have a concert, exhibition or live experience to put on the kitchen calendar – for this year or next – and look forward to after such an awful 2020. Access to live entertainment is part of what makes the Australian lifestyle so special, which is why our industry needs and deserves temporary assistance to ensure its survival.”
Roger Field, President of Live Nation Asia-Pacific said: “Another simple action – which also has a precedent – is the introduction of an industry-led Live Entertainment Business Interruption Fund underwritten by Government to overcome the fact that we cannot get any insurance to cover us for shows being stalled due to COVID. We are a very self-sufficient industry; however, we need the support of Government in respect of losses incurred due to interruptions caused by the imposition of COVID related restrictions. This small safety net would allow us to get back to investing in our events and communities as we return safely and responsibly.
“The Government has set up a $50 million Screen Australia fund to overcome this problem for the screen production sector, and it has allowed that industry to get back to work, shooting movies and TV shows. As proven by this report, event fans contribute significantly more spending in the local economy, so there’s even more value in figuring out this solution to get our shows back on the road.”
The preliminary findings of The Economic Cost of COVID-19 on Australia’s Live Entertainment Industry will be unveiled by Matt Colston, EY’s Associate Partner for Sports, Events and Venues Consulting, at 9am AEDT today (Wednesday 14th October) at The Event Summit 2020, followed at 9:30am AEDT by a Q&A with James Sutherland, Geoff Jones and Roger Field, hosted by 7NEWS Finance Expert Gemma Acton. The event is free to view online, viewers can register here.