Five connections that underpin the impact of the UK arts sector

As we have seen, the arts sector has a direct economic and noneconomic impact on society, beyond the intrinsic value of the arts. How does the sector achieve this impact, and how can it be sustained? Our analysis shows that it depends not only on the individual efforts of those in the arts ecosystem but also on important connections between them—sometimes in the form of collaboration, sometimes codependencies, and sometimes reinforcing mechanisms.

At the simplest level, this impact might result from individuals and organisations working together by playing different roles within an art form. For example, a composer, an orchestra, a funder, and a concert hall (with their different providers and suppliers) might work together to create and perform the world premiere of a new symphony to a capacity audience.

But the connections reach far beyond this. Through a steadily widening lens, the remainder of this report examines five other connections that underpin the ability of the sector to achieve and sustain its impact. The connections link the following:

1. different art forms
2. not-for-profit and for-profit arts organisations
3. artists and arts organisations in different locations
4. arts organisations, local public bodies, and local businesses
5. the arts sector and the broader creative industries

Connection #1: Between different art forms

Individuals and organisations aren’t bound within a single art form—film, dance, or music, for example. They work fluidly between them, forming strong connections that create resilience and foster innovation. Sometimes, the success of a work in one field depends on the creative activity of another. Such is the strength of the connections. They are essential to sustaining the high-quality artistic activity responsible for the sector’s impact.

No single form of art operates in isolation. Many venues work across the arts: for example, London’s Southbank Centre, the Warwick Arts Centre, the Strule Arts Centre (in Omagh), and the Barn (in Aberdeenshire) all programme events across the visual, performing, literary, and screen arts. They gather artists, audiences, and funders from all these arts under a single roof.

Many individuals work across art forms, too. The costume designer Sandy Powell is renowned for her work in film, opera, and theatre.¹Francisco Salazar, “Sandy Powell & other film costume designers who have also worked in opera,” OperaWire, March 20, 2017. John Butt is the musical director of the Dunedin Consort, as well as professor of music at the University of Glasgow. Wayne McGregor, the Royal Ballet’s resident choreographer, is recognised for his groundbreaking collaborations across the arts. He has worked, for example, as a movement coach on the film Fantastic Beasts and Where to Find Them and produced the motion capture for the augmented reality ABBA Voyage concert.

It’s not just well-known individuals who work fluidly across art’s boundaries. The high share of self-employed workers and the relevance of many roles—actors, lighting technicians, and directors, for instance—in multiple art forms mean that it’s common among people at every level. One-third of those working in theatre, for instance, also work in music and live events, 29 percent also in TV, and 26 percent also in film.²Alexandra Albert et al., Publicly-funded arts as an R&D lab for the creative industries? A survey of theatre careers in the UK, Creative and Cultural Industries, The National Skills Academy, January 2013; Stage Directors 2023 Census, Stage Directors UK, 2023.

These connections help to make the arts ecosystem more resilient—for example, by giving people within it more employment opportunities. And they foster innovation as artists and arts organisations draw creative inspiration from different art forms. In 2017, for instance, as part of the London International Mime Festival, the Barbican hosted Kiss and Cry. This collaboration between film, dance, music, and theatre told the story of an old woman’s doomed first love through dancing hands and a roving camera.³“Kiss & Cry Collective: Cold Blood,” Barbican, 2020. A new, unique piece of art was created at every performance. Since the show was first devised, in 2011, it has been performed 300 times in eight different languages and been watched by some 180,000 people.⁴“Kiss & Cry,” Astragales.

Sometimes, the connections are so strong that the success of one art form depends significantly on the creative output of another. From 2014 to 2023, for instance, seven of the ten films that won the Outstanding British Film award of the British Academy of Film and Television Arts (BAFTA) also won Best Original Score in prestigious music awards.⁵McKinsey analysis, based on public announcements from BAFTA and other sources. Likewise, film production depends on the literary arts for screenplays. Half of the 20 top-grossing films produced in the United Kingdom from 2007 to 2016 were based on previously published literary works. These films accounted for 60 percent of total UK box office sales over the same period.⁶“Film, TV and theatre adaptations of books attract more revenue, viewers, and critical acclaim,” Publishers Association, July 10, 2018. The benefits flow both ways. Harry Potter book sales, for example, more than tripled in the month following the release of the film adaptation of Harry Potter and the Philosopher’s Stone, in 2001.⁷Dean Talbot, “Impact of book publishing on film industry,” WordsRated, February 23, 2023.

Connection #2: Between for-profit and not-for-profit organisations

The tight connections between for-profit and not-for-profit arts organisations can go unrecognised. They work in unison to fund and promote projects, and they share skills, experience, ideas, and knowledge. The result? More high-quality artistic activity.

At first glance, there seems to be a clear separation between not-for-profit and for-profit organisations. The primary purpose of the first is social benefit; that of the second, profit. A closer look, however, uncovers similarities and connections.

To begin with, though not-for-profit organisations depend on government and philanthropic funding more than for-profit ones do, as much as 50 percent of the not-for-profits’ income is derived from earned and commercial sources (see sidebar “Not-for-profit versus for-profit organisations”).⁸McKinsey analysis, based in part on the Arts Council England’s Annual Funding Survey (2019), Creative Scotland’s Annual Review of Performance 2019/20 (2020), and the Arts Council of Northern Ireland’s Annual Review—2019–20 (2020). Moreover, the two types of organisations often work in unison to fund artistic projects , and there is extensive sharing of skills, experiences, ideas, and knowledge. In other words, the connections facilitate more (and high-quality) art activity.

Funding. Much artistic activity is funded both by for-profit and not-for-profit organisations—a model that improves the commercial viability of successful projects that might otherwise not go ahead.

For instance, The Fall, first released in 2013, was a popular, award-winning TV crime drama series set in Northern Ireland. It was co-funded by Ingenious (the producer behind the science fiction film franchise Avatar) and by several not-for-profit organisations,⁹Ingenious, June 2021. including Northern Ireland Screen, the European Regional Development Fund, and the Northern Ireland Development Corporation. Likewise, Re-Bourne, a charity that runs dance and theatre workshops for young people, receives funding from both its parent for-profit company, New Adventures, and from the Arts Council England, which made grants totalling £5 million from 2018 to 2022.¹⁰“National Portfolio Organisations 2018–22,” Arts Council England (updated April 1, 2021).

Many for-profit organisations also directly fund or support not-for-profit activities to incubate new talent or support local communities, either through partnerships or their own not-for-profit foundations or organisations. These are examples:

• In 2022, Channel 4 contributed £5 million to the 4Skills training programme, aimed at young people aspiring to work in television and related fields. That year, 19,000 students aged 11 to 14 took part in the programme, which also found industry placements for some 200 young people though internships, apprenticeships, and enrolment on production training schemes.¹¹“Finding, nurturing and growing the UK’s next generation of creative talent,” Channel 4, January 2023.
• Pinewood Studios distributed £500,000 over ten years to support youth education in the screen arts.¹²“Shepperton Studios Community Fund launches to support youth and community development within Spelthorne,” Shepperton Studios, January 4, 2022.
• The foundation of artist Tracey Emin supports emerging artists through residency programmes and the provision of free studio space at her newly built art facility (in Margate) and through promotional activities.¹³Anny Shaw, “Tracey Emin sells new work for £2.3m at Christie’s and will use the money to fund her new art school,” Art Newspaper, October 14, 2022. The sale of her artwork finances the foundation.

Skills and experience. Not-for-profit organisations are often an essential training ground for artists who subsequently engage in both for-profit and not-for-profit activities. The National Youth Theatre’s not-for-profit performing-arts training scheme, for example, boasts alumni such as Helen Mirren, Daniel Craig, and Colin Firth.¹⁴“About us,” National Youth Theatre. In a survey of more than 1,000 people working in the theatre, 62 percent of the respondents said that they considered experience in the not-for-profit sector as critical to successful theatre careers, not least because it offered the opportunity to work on new and challenging productions.¹⁵Alexandra Albert et al., Publicly-funded arts as an R&D lab for the creative industries? A survey of theatre careers in the UK, Creative and Cultural Industries, The National Skills Academy, January 2013.

But it is not just a question of moving from the not-for-profit to the for-profit world. In the arts sector, people constantly move back and forth between the two: a recent survey found that 32 percent of theatre performers and 29 percent of stage managers worked in both.¹⁶Alexandra Albert et al., Publicly-funded arts as an R&D lab for the creative industries? A survey of theatre careers in the UK, Creative and Cultural Industries, The National Skills Academy, January 2013. The fact that work in the arts sector is often project based explains this to-and-fro. But people in the sector also regard it as a way of working with a more diverse group of collaborators and performing for different types of audiences.

The Lehman Trilogy at the National Theatre. Photo by Mark Douet.

Three members of the The Lehman Trilogy standing defiantly and dressed in black vintage tuxedos and overcoats at the National Theatre. Photo by Mark Douet.

Artistic content and knowledge. Much artistic activity depends on the exchange of content and knowledge between for-profit and not-for-profit organisations. Productions that begin in the not-for-profit world, where organisations can take more risks with creative content, often become commercial hits once they prove their financial worth. The West End theatre hits Six, The Lehman Trilogy, and Matilda were among these productions: Six was a university-society musical at the Edinburgh Fringe, The Lehman Trilogy began at the National Theatre, and Matilda, which debuted at the Royal Shakespeare Theatre,¹⁷Douglas Mayo, “Six musical will move to Vaudeville Theatre,” britishtheatre.com, July 16, 2021; Will Longman, “National Theatre’s The Lehman Trilogy to transfer to the West End,” London Theatre, February 16, 2022. has since become a global phenomenon watched by 11 million people.¹⁸“Matilda History,” Royal Shakespeare Company. Without the space, time, experimentation, and risk-taking that the not-for-profits afford, some of the best and most popular art produced by for-profits might not exist.

Not-for-profit organisations also act as repositories of knowledge and inspiration for profit-making organisations. Commercial art dealers and auction houses, for example, use the collections and the expertise of not-for-profit galleries, museums, and libraries in their research. The British Film Institute (BFI) curates the BFI National Archive, one of the world’s largest moving-image archives, used by people in film production and by educators.¹⁹“Regional and national archives,” British Film Institute.

People in the not-for-profit world often contribute to such repositories by donating their works and archive materials. For instance, the estate of the musician and actor David Bowie, together with donations from corporate and private philanthropists, supported the Victoria and Albert (V&A) Museum in acquiring more than 8,000 items, including handwritten lyrics, costumes, set designs, and instruments.²⁰Simon Stephens, “V&A to create David Bowie centre after acquiring archive,” Museums Association, February 23, 2023; V&A. And the publishers of any literary work published in the United Kingdom must provide a copy to six major not-for-profit libraries: the British Library, the National Library of Scotland, the National Library of Wales, the Bodleian Libraries (Oxford University), the Cambridge University Library, and the Trinity College Dublin Library.²¹“About legal deposit,” British Library.

Connection #3: Between arts organisations in different locations

Collaboration between arts organisations in different places helps bring art to the broadest possible audience across the United Kingdom and spreads skills, knowledge, and artistic content. More engagement and more high-quality artistic activity ensue.

In the arts sector, as in any other, organisations tend to concentrate in certain regions or localities. Eight of the United Kingdom’s biggest cities—Belfast, Birmingham, Bristol, Cardiff, Edinburgh, Glasgow, London, and Manchester—have an estimated 44,000 arts enterprises among them. That leaves an additional 95,000 outside these cities, in communities that are home to upward of 54 million people, or 80 percent of the UK population.²²McKinsey analysis, based in part on the dataset for UK Business: activity, size, and location, Office for National Statistics (September 2023 release). At a more granular level, the Creative Industries Policy and Evidence Centre has identified 709 distinct microclusters where creative individuals and companies mingle, share ideas, and innovate.²³Josh Siepel et al., “Creative radar: Mapping the UK’s creative industries,” Creative Industries Policy and Evidence Centre, November 19, 2020.

Art often reaches the broadest possible audience when artists and arts organisations based in different locations across the United Kingdom collaborate:

• ARTIST ROOMS presents the work of international artists in solo exhibitions drawn from a national touring collection jointly owned by Tate and the National Galleries of Scotland. Since 2009, it has been shown in 209 exhibitions at 94 museums and galleries across the United Kingdom, attracting nearly 60 million visitors.²⁴Tate.
• Scottish Opera, Scotland’s largest performing-arts organisation, aims to give people in the nation’s 32 local authorities an opportunity to attend an opera performance within a 30-minute commute. From 2019 to 2021, it staged more than 75 pop-up operas in arts venues and other spaces, as well as 100 school performances. Altogether, more than 40,000 people attended.²⁵Annual Report April 2019–March 2020, Scottish Opera, December 2020.
• The Southbank Centre’s Hayward Gallery Touring programme creates exhibitions that expand and complement the programmes of partner galleries for venues such as museums, galleries, art centres, libraries, universities, schools, and hospitals. These exhibitions are seen by up to half a million people each year, in more than 45 cities and towns across the United Kingdom.²⁶“Hayward Gallery Touring,” Southbank Centre.

Art organisations do not have to tour to extend their reach. The National Theatre, for instance, broadcasts productions from its stages and other theatres to cinemas around the world. Since the programme's launch, in 2009, nearly 100 productions have been seen by more than 11 million people in 2,500 cinemas in 65 countries.²⁷“Good,” National Theatre Live.

Arts organisations in different locations also share skills and knowledge. For example, the Roundhouse (a music, performing-arts, and concert venue in North London) partnered with the Gloucester Culture Trust to enrich the city’s cultural life.²⁸“Engaging young people,” Gloucester Culture Trust; Roundhouse. Together, the two organisations worked on Gloucester’s strategic approach to audience development and participation, funding, and the improvement of cultural infrastructure. They also designed additional ways to engage local children and young people with the arts and established the Future Producers scheme, which teaches participants how to set up a festival, create events, and run and promote their own events.²⁹“Engaging young people,” Gloucester Culture Trust; Roundhouse. And the Royal Opera House has partnered with Doncaster Council to implement the Create Learn programme, which provides free teacher training courses and digital-curriculum resources to 100 schools in the local area.³⁰“Doncaster: Award-winning teacher training,” Royal Opera House, 2022.

The flow of talent between arts organisations in different locations supports the spread of skills and knowledge too. That’s apparent in the museum and gallery sector, where curators often move from one location to another, bringing their valuable expertise and networks. Clarrie Wallis, now director of the Turner Contemporary in Margate, was formerly the senior curator of contemporary art at the Tate.³¹“Turner Contemporary appoints new director: Clarrie Wallis, senior curator of contemporary art (British) at Tate,” Turner Contemporary, September 24, 2021. Anne Barlow, now director of the Tate St Ives, also worked as a curator at Glasgow Museums.³²“Tate St Ives Director,” Tate. And Simon Wallis, director of the Hepworth Wakefield, has held positions at the not-for-profit Chisenhale Gallery in London, the Institute of Contemporary Arts, and Tate Liverpool.³³“Simon Wallis awarded OBE in Queen’s Birthday Honours List,” Hepworth Wakefield, June 12, 2015.

Finally, arts organisations in different locations benefit from the sharing of artistic knowledge and content. For example, in the last 18 months, regional collaborations at the National Theatre have included co-productions of Romeo and Juliet, with Sherman Theatre in Cardiff; Our Generation, with Chichester Festival Theatre; and the Olivier Award–winning musical Standing at the Sky's Edge, with Sheffield Theatres. The National Theatre benefits from diverse creative content and partner theatres from a broader audience reach.³⁴Craig Simpson, “One-third of National Theatre productions are produced by local theatres outside London,” Telegraph, June 4, 2021.

Connection #4: Between arts organisations, local public bodies, and local businesses

A good deal of artistic activity depends on collaboration among arts organisations, local public bodies, and local businesses. Without it, much activity—particularly big events—wouldn’t happen. Collaboration is therefore essential to the sector’s impact.

Strong connections among local arts organisations, local public bodies, and local businesses are critical for supporting the art sector’s impact. Often the connection is financial. In 2019–20, for example, local authorities accounted for some 40 percent of all public funding for arts and culture projects in England, according to the Policy and Evidence Centre.³⁵Salvatore Di Novo and Eliza Easton, “A new deal for arts funding in England?,” Creative Industries Policy and Evidence Centre, January 12, 2023. Without that support, many projects would not be viable.

Public bodies and businesses play other supportive roles, beyond funding. Public bodies enable and convene community-wide arts initiatives and programmes by providing space and venues and by offering planning and policy support—for instance, arranging parking facilities, extending drinking licences, and providing public toilet facilities. The involvement of public bodies is particularly important for major events, such as the 2023 Eurovision contest, in Liverpool.³⁶Liverpool City Council blog, “How Liverpool came together to deliver Eurovision,” blog entry by Darren Henley, October 27, 2023.

Businesses not only fund community programmes but implement them too: for example, Burberry, the luxury fashion house, which manufactures some of its collection in West Yorkshire, has funded and helped mount workshops in film, dance, theatre, and the visual arts in partnership with local schools and leading arts organisations in the area. These organisations include the Hepworth Wakefield, the Leeds Playhouse, Leeds Young Film, and Northern Ballet. The programme, implemented by the Burberry Foundation, has involved 10,000 students in 15 schools over four years.³⁷Burberry Inspire: Celebration report 2018-2022, Burberry, 2022. In the next three, the foundation hopes to involve 500,000 more around the world.

Businesses also offer strategic advice. Besides sponsoring Sunflowerfest, a three-day music and arts festival held in Belfast from 2017 to 2020, the Forestside Shopping Centre gave the organisers advice on budgetary control, strategic planning, and site and infrastructure improvements.³⁸”Celebrating creative partnerships,” Arts & Business Northern Ireland. Such joint efforts can prove particularly powerful when arts organisations, local public bodies, and local businesses work together closely. The Manchester International Festival, for instance, is a biennial event for music, theatre, dance, and the visual arts. It exists thanks to a partnership among the Manchester City Council, the Factory (an arts and culture venue), local businesses (such as Electricity North West, which provides the power), and local volunteers. The festival not only increases the impact of the UK arts sector but also contributes to local investment and Manchester’s economic growth by raising the city’s national and international profile. Today, the festival is a leading cultural destination for showcasing major events. In 2019, its economic impact was estimated, across a range of measures, at £50 million.³⁹“Manchester International Festival 2021,” Manchester City Council, November 17, 2021.

StartEast, which provides grants, business support, and training for arts practitioners and art businesses in Norfolk and Suffolk, has had a similarly high impact. The organisation was set up by the Norfolk and Suffolk Culture Board, which brings together leaders from local arts organisations (such as Britten Pears Arts and the Norwich Theatre), local councils, local business leaders, and the Arts Council England. The programme ended in 2019. By 2020, one-third of the more than 350 local businesses StartEast had engaged with reported higher turnover and productivity. SubMotion Productions, a film production company, is among the success stories. StartEast helped SubMotion to set up an editing suite and provided financial and administrative support for one of its films, Sylvia, shown in 2019 at the Cannes Film Festival,⁴⁰“Culture drives impact: The Norfolk and Suffolk Culture Board manifesto,” Suffolk County Council, 2022. where it won the Best Short Film award.⁴¹Sylvia, SubMotion Productions, 2020.

A large crowd watching a band perform at night during a summer music festival in the UK.

Connection #5: Between the arts sector and the broader creative industries

Connections linking the arts sector to the broader creative industries are everywhere to be seen. Skills, knowledge, content, and services flow constantly between them, sustaining high-quality and often innovative activity in both sectors.

In the United Kingdom, the creative industries are large and growing fast: by 32 percent from 2010 to 2019.⁴²Creative industries sector vision: A joint plan to drive growth, build talent, and develop skills, Department for Culture, Media & Sport, June 20, 2023.The GVA of the UK economy as a whole increased by 20 percent during the same period.⁴³Gross Value Added (Average) at Basic Prices: CP SA £m, Office for National Statistics (updated September 29, 2023). In 2022, according to the latest data, the sector’s GVA is estimated to have reached £126 billion, up from £115 billion in 2021.⁴⁴“DCMS and digital economic estimates: Monthly GVA (to September 2023).” GVA estimates are official statistics in development, estimating the contribution of DCMS sectors to the UK economy as measured by GVA. These estimates tend to be volatile and are revised regularly. They are an indicator of trends and are more effective at estimating change over time than as definitive figures. The creative industries therefore account for 5.7 percent of the United Kingdom’s total GVA—close to the contribution of the construction industry and three-quarters of the contribution of the financial-services industry.⁴⁵Gross value added (average) at basic prices: CP SA £m. In addition, the creative-industries sector has some 2.46 million jobs (exhibit).⁴⁶“Economic estimates: Employment in DCMS sectors and digital sector, April 2022 to March 2023,” Department for Culture, Media & Sport and Department for Science, Innovation & Technology (updated October 25, 2023).

The arts sector and the broader creative industries collaborate extensively and share connections and dependencies. These can be seen everywhere. Skills, knowledge, content, and services flow constantly between the two, often promoting innovation. Arts educators bring together students and teachers from both spheres. The University of the Arts London and the RCA, for instance, provide programmes across the visual arts, as well as in design and architecture, creating plentiful opportunities for exchange and collaboration.⁴⁷“Browse our subjects,” University of the Arts London; “Programme finder,” Royal College of Art. The V&A Museum collections span the visual arts, design, crafts, fashion, and architecture. Exhibitions often combine curatorial expertise from across these art forms and disciplines in the creative industries.⁴⁸“From the collections,” Victoria and Albert Museum.

The connection between organisations working in advertising content and production (worth some £20.6 billion in GVA in 2022) and the screen arts is particularly strong.⁴⁹“DCMS and digital economic estimates: Monthly GVA (to September 2023).” Many organisations work in both. So do directors, actors, and music producers. For example, MPC, one of the United Kingdom’s largest visual-effects (VFX) companies, is recognised for its work on films such as Harry Potter, 1917, and Life of Pi. It also runs an advertising arm that produces content for many global brands.⁵⁰“10 incredible examples of VFX from MPC,” Creative Bloq, September 17, 2013.

Often, artistic activity directly supports the creative industries. Arts collections, museums, and archives are essential references for designers and architects. Music and visual art are fundamental to the creative processes of industries such as advertising or fashion. Examples of collaboration and cross-inspiration between fashion and the arts include these:

• In 2017, Burberry creative director Christopher Bailey joined forces with the Henry Moore Foundation. Bailey’s collection at London Fashion Week, inspired by the British sculptor’s work, used fabrics to sculpt the body and to change proportions. The same week, a new exhibition of Moore’s sculptures opened in London.⁵¹Jess Cartner-Morley, “Burberry joins forces with Henry Moore as label becomes a creative force,” Guardian, February 20, 2017.
• Lovers Rock was the name of the 2020 autumn menswear collection by Grace Wales Bonner. She took inspiration from the work of photographer John Goto (who documented the lives of young British Afro-Caribbeans in London in the 1970s) and from Lovers Rock music (a laid-back, romantic form of reggae).⁵²Lauren Cochrane, “‘Well put together’: the style legacy of lovers rock,” Guardian, November 20, 2020.
• In 2022 a project called Process, by fashion label Alexander McQueen, invited 12 artists from around the world, working in different mediums, to reinterpret pieces from the autumn–winter collection. The aim was to celebrate the creativity that comes from diverse perspectives. The result was artwork ranging from epoxy resin sculptures to embroidered Polaroids.⁵³“Alexander McQueen’s ‘Process’ is a reinterpretation of the maison’s pre-autumn/winter 2022 collection,” Vogue, June 13, 2022.

The United Kingdom has such a strong VFX industry thanks to the success of the UK film industry—production spending rose by 600 percent in ten years, to reach £6.3 billion in 2022.⁵⁴Statistical Yearbook, British Film Institute, 2023. In the early 2000s, when VFX was still a very young industry in the United Kingdom, the Harry Potter series provided steady demand for the services of what have since become major VFX companies, such as DNEG, Framestore,⁵⁵Helen O’Hara, “How London became the VFX capital of the world,” Time Out, September 20, 2019. and MPC. In turn, the VFX industry has fuelled demand for software for the film industry, developed by UK companies such as Foundry. Foundry’s software—for 3-D modelling, painting, and special effects lighting, for example—is used across the creative industries, including architectural modelling and product design. In film, Foundry’s clients include Disney, DreamWorks, and Framestore.⁵⁶”Foundry,” Foundry Visionmongers, 2023.

Similarly, the success of the film and television industry has propelled significant capital investment in soundstages. From 2021 to 2026, the soundstage sector’s capacity is expected to grow by 11 percent a year, to reach 245 million square feet⁵⁷McKinsey analysis, based on public announcements, planning applications, and other sources.. Existing facilities at Leavesden, Pinewood, and Shepperton will be extended, and US companies will build new ones.

A young man wearing a VR headset with futuristic graphics projected on him.

The broader creative industries are also critical partners for the arts sector in the use of new technologies. These offer new opportunities for the creative process. Technology can transform audience reach through digital platforms, increase the share of collections available for public consumption, and create opportunities for personalised experiences through the use of augmented reality (AR), virtual reality (VR), mixed reality, and artificial intelligence (AI). In 2020, for example, the Royal Opera House produced Current, Rising, billed as the first hyper-reality opera, in collaboration with Figment, a London-based AR–VR and computer-generated-content producer, which works mainly in the entertainment sector. Its clients include Legoland, Madame Tussauds, and Thorpe Park.⁵⁸Stuart Jeffries, “‘Anything could happen’: Inside the world’s first virtual reality opera,” Guardian, May 4, 2021. See the sidebar “Technology meets the arts” for more examples of how technology organisations collaborate with those in the arts to create and help people experience art in innovative ways.

The arts sector also contributes indirectly but significantly to the UK economy. A comprehensive analysis of this subject would be too large a topic for this report. Rather, to convey the importance of the arts sector’s impact on the wider economy, we point briefly to three examples: how the sector attracts overseas visitors to the United Kingdom, supports its soft power, and helps build the skills required in a thriving 21st-century economy.

Overseas visitors

The United Kingdom’s arts sector is a powerful attraction for overseas tourists. Seventy-three percent of those surveyed in 80 countries identified the UK ”cultural offer” as a key motivation for visiting the country, according to one report. An estimated 30 percent of all inbound tourists participate in UK arts and culture activities.⁵⁹“Understanding the London+ visitor,” London & Partners, 2014. They directly support the UK economy through arts and culture spending worth £1 billion.⁶⁰McKinsey analysis, based in part on The contribution of the arts and culture to the national economy, a report by the Centre for Economics and Business Research for Arts Council England (May 2013) and the dataset for Travel trends: 2022, Office for National Statistics (May 2023 release).

Take, for instance, Edinburgh’s 11 major festivals, nine of which are arts festivals. In 2022, these 11 festivals attracted 3.2 million people—31 percent of them visitors to Scotland. The economic impact for Scotland was £367 million.⁶¹Edinburgh Festivals Impact Study 2022, BOP Consulting, report for Festivals Edinburgh, June 2023. And Game of Thrones, a TV series filmed in Northern Ireland, prompted some 350,000 tourists to visit the United Kingdom in 2018, spending an estimated £50 million.⁶²Building the value of tourism, Tourism Northern Ireland, 2019.

Beyond tourism, the global reputation of the UK arts sector helps attract temporary and permanent residents from overseas, who contribute to the wider UK economy. The United Kingdom regularly appears among the top ten countries on the Anholt-Ipsos Nation Brands Index (which measures perceptions of different countries around the world) and among the top five on its “contemporary cultural” index.⁶³How the world views the UK—2022, VisitBritain, November 2022. London was ranked number one out of 48 cities in the 2022 Global Power City Index, which gauges the ability of urban areas to attract people and businesses on a range of measures.⁶⁴“Global Power City Index 2022,” Mori Memorial Foundation, December 2022. London outscored all other cities on the “cultural interaction” one.

Soft power contributor

The reputation of the UK arts sector also contributes to the country’s soft power overseas. UK arts organisations and artists, often invited to perform abroad, work with their international counterparts, take part in exchanges, and build cultural relationships and a positive view of the United Kingdom’s contributions to global society.

For example, the London Symphony Orchestra and Australia’s Melbourne Symphony Orchestra have reciprocal touring arrangements and co-commission performances.⁶⁵Steve Wright, “Australia-UK orchestra exchange announced,” BBC Music Magazine, November 30, 2022. Broadway transfers of National Theatre productions bring them to US audiences. And after COVID-19 restrictions lapsed, many UK arts organisations and artists have resumed touring abroad, often in collaboration with international co-production partners.

The UK government acknowledges the importance of the arts sector’s contribution in this respect. Its 2023 refresh of the Integrated Review, which sets the country’s national-security and international strategy, noted that arts and culture were among several areas that help the United Kingdom forge strong reciprocal relationships around the world.⁶⁶Integrated Review Refresh 2023: Responding to a more contested and volatile world, GOV.UK (updated May 16, 2023).

Skills of the future

The arts sector can make a powerful contribution to building the skills required by a thriving 21st-century economy, in which artificial intelligence will do much of the knowledge-based work previously undertaken by humans. In the future, the skills in demand will be those centred on creative thinking and self-efficacy skills.⁶⁷Future of Jobs Report 2023, World Economic Forum, April 30, 2023. A World Economic Forum report, New vision for education, identified 16 such skills, including creativity, problem-solving, adaptability, persistence, and sociocultural awareness.⁶⁸New vision for education: Unlocking the potential of technology, World Economic Forum, 2015. Many of them can be developed through engagement with the arts.

Business schools and companies are taking note. Four of the top five MBA programmes in the United Kingdom (as ranked by QS Universities and the Times) now include arts-oriented curriculums.⁶⁹“QS World University Rankings by subject 2023: Art & Design.” The London Business School and the Royal College of Art, for example, have a course-sharing partnership, and Imperial College Business School and the Royal College of Art run a joint research and entrepreneurship lab (Wicked Acceleration).⁷⁰“RCA collaborates with Imperial College Business School to launch Wicked Acceleration Labs,” Royal College of Art, June 2021. As for technology companies, Amazon, Google, and Meta have all engaged improvisation-training companies and comedy clubs to help their UK employees build communication skills.⁷¹"Corporate training from the UK's biggest improv school," Hoopla Impro, 2023. Arts organisations such as the Old Vic Theatre and the National Theatre run corporate-communication training courses that help participants build a personal presence, rapport, and leadership skills.⁷²“Training,” The Old Vic, 2023; “Theatreworks,” National Theatre, 2023.

The arts sector has much to offer for developing the skills and qualities that well-rounded 21st-century leaders require.

Read the next chapter: Implications.