The multibillion-pound UK music industry remains about a third smaller than before the pandemic as rampant inflation, rising costs and Brexit red tape threaten to derail its fragile recovery, a report warns.
UK Music, the umbrella organization representing artists and live performance record labels, is calling for a package of support including tax relief, a VAT cut for struggling venues and streamlining of restrictions affecting workers and travel between Europe and the UK.
The organisation’s annual Music by Numbers report, which covers topics including music sales and licensing, stadium tours, gigs at grassroots venues and merchandise, found that the industry’s contribution to the UK economy will grow by 26% year-on-year to £4bn in 2021. However, this is down 31% from the record £5.8bn in 2019.
While music streaming has grown and sales of CDs and vinyl have risen amid the pandemic, the live music industry, which employs thousands of musicians, songwriters, producers and venue owners, was badly hit and faces a “fragile and uncertain” recovery.
Major events including Glastonbury and BST Hyde Park were canceled last year, while music venues were only able to open for four months, limiting the return of staff and artists.
More than a third of UK music industry workers, a total of 69,000, lost their jobs in 2020. Their numbers rose 14% last year to 145,000, but that’s down 26% from the 197,000 employed in 2019.
Jamie Njoku-Goodwin, chief executive of UK Music, said: “Our workforce is frustrated and devastated. “The fact that thousands of them have yet to return should worry policymakers and the public. Our sector still faces a serious threat of economic storms that could blow away our fragile recovery without urgent government support.”
The UK is calling for support, including expanding the hugely successful tax relief programs enjoyed by the film, TV and gaming industries, cutting VAT to 5% to help struggling venues and scrapping the red tape that makes it difficult to bring in workers from Europe. And significantly more expensive to travel to within the EU.
Some estimates are 35% higher than in 2019, including increases in costs for venues and musicians, including road crew, catering, security, transportation and, most recently, fuel and energy costs.
“The industry has been hit by rocketing costs throughout the supply chain, and unless venues, studios and other music businesses get the help they need, there is a serious risk they could be forced to close their doors for good,” says UK Music.
British music exports, including record sales and streams, live shows by British artists and merchandise sales, rose 10% to £2.5bn. However, this is still below the £2.9bn in pre-pandemic 2019.
The UK is the second largest exporter of recorded music after the US, with Adele, Ed Sheeran and Dua Lipa releasing three of the top six best-selling albums of 2021.
“The UK music industry is working hard to recover after the devastating impact of Covid, but there is still some way to go to recover the jobs and growth lost during the pandemic,” Njoku-Goodwin said.