Music biz contributes $42m to NZ economy
The New Zealand music industry’s value to the country’s economy continues to grow.
Last year it contributed a total impact of NZ$472 million (Australian $442.2 million), an increase of 4.4% from $452.2 million in 2013.
Of this, $213 million was a direct contribution. Total impact, a rise worth $20 million, was based on industry-related businesses spending money on other industries and industry employees supporting the wider economy. New Zealand’s GDP was $217 billion in the June 2015 quarter.
Employment in the music industry’s ranks grew by 5.3% to 4295 full time equivalent jobs. The figure was 4077 in 2013.
The report by PWC, was commissioned by licensing and copyright collectives Recorded Music New Zealand, the Australasian Performing Right Association/Australasian Mechanical Copyright Owners Society, the Government-funded New Zealand Music Commission, Te Mangai Paho, NZ On Air and Creative New Zealand.
The biggest chunk of the $472 million was contributed by music radio broadcasting with $238 million, which had a total of 2346 jobs.
Live music performance at festivals, concerts and music venues was second in contribution with $120 million and 1193 jobs.
Together these two sectors constituted 75% of the industry’s total contribution and 80% of its total employment impact.
Music retail – physical and digital sales, including traditional and store-based retailing, online stores and payments for online music streaming services – contributed $76.4 million had 380 employees.
Communication and public performance generated $33 million with a workforce of 329. The subsector includes revenue from music played on radio, television and the internet as well as music played in public such as at retailers, hospitality outlets, education facilities and gyms.
Synchronisation – referring to the royalties earned from licensing music for use in advertisements, games, films and television programmes – provided $5 million to the overall figure with a workforce of 47.
Sales of NZ acts directly contributed $54 million to the economy. But music retail’s economic contribution showed a turndown, after peaking in 2001 at $120 million. New Zealanders’ eager embrace of streaming has created a problem. Physical product sales were 42% of total gross output from 62% in 2012, while gross revenue from online music streaming rose from $2.2 million in 2012 to $18.6 million in 2014.
The report stated, “On the one hand, illegal use has provided consumers with an effectively free source of music, which has led to a drop in sales and is likely to have reduced the price point at which consumers are willing to purchase music.
“On the other hand, new services for digital music purchasing or consumption have emerged as rapidly-growing alternatives to physical retail.”
Image: New Zealand-based artist Stan Walker