Page title

Intro

Executive summary

Introduction

Creative Industries (CIs) are those businesses that turn creative ideas into commercial outcomes. The economic, social, industrial and cultural contributions of these industries are increasingly being recognised as essential elements of an advanced and thriving regional economy. They are vital in determining the image of a region, retaining talent to that region and providing positive, substantial benefits to other industry sectors.

Employment

In 2006 Metropolitan Perth’s Creative Industry (CI) segments employed almost 40,000 people and contributed $4.6bn to the local economy. The flow-on value was an additional $6bn, bringing their total contribution to more than $10bn.

Economic impact

Perth’s CIs account for 3.4% of the output of all industries in Metropolitan Perth. The value added (i.e. the total value added to the economy calculated by determining firms’ total sales after deducting the cost of purchases from other firms) is $2.6bn. This accounts for 56% of the direct output (of $4.6bn) from the CIs, significantly higher than the average value-added of 44% in non-creative sectors.

Exports

Exports from Metropolitan Perth’s CI segments to other parts of the state and overseas are also far higher than for other industry sectors. In 2006 CIs generated $687 million in exports, or 20% of output, compared to 16% average exports in non-creative sectors.

Employment growth

Employment growth in Metropolitan Perth’s CIs was four times the rate of other industry sectors in the first half of this decade. There was a 7.3% cumulative annual growth rate (CAGR) between the censuses of 1996 and  2001. This was substantially higher than the overall level of growth of Perth’s workforce over this same period (1.8%). Total employment in the CIs is divided roughly equally between creatives working in CI organisations; non-creatives working in CI organisations and creatives working in non-creative industries e.g. Government Administration, Property and Business Services, and Manufacturing. In 2006 the salaries of these CI workers were estimated to be worth $1.92bn.

Creative industry segments

Software and Interactive Media development is the largest employer of the 11 CI segments examined in this report. It is also the fastest growing, followed by Advertising and Music.In April 2006, there were 11,000 businesses registered for GST in Perth’s Creative Economy, representing 6.6% of firms across all industries. The number of CI businesses and sole operators having an Australian Business Number (ABN), but which had not reached the revenue threshold to pay GST, more than doubled in the five years between 2001 and 2006.

Metropolitan Perth’s CI performance

The overall size of Metropolitan Perth’s CIs is broadly on par with other state capitals. There is high representation in Publishing and Architecture and the city is in line with national averages in Visual Arts and Graphic Design, Music and Performing Arts. Fewer representations are recorded for Software and Interactive Content, as with Advertising and Marketing, Film, TV and Radio. Metropolitan Perth is the hub of WA’s CI activity. The city encompasses 90% of WA’s total creative employment, compared with a 74% share of all employment. Assessed in terms of professional qualifications, Perth has a wealth of creative talent and qualified people.

Geographical concentrations

The largest number of CIs workers are employed within the City of Perth and the Local Government Authority (LGA) with the highest proportion of CI workers is the City of Subiaco. The LGA with the fastest growth rate in CI employment is the City of Belmont.

Summary of key policy challenges

The fact that the vast majority of CI organisations are very small and so suffer a lack of scale, leads to significant shortcomings in business capability, financial capacity and a capacity to generate intellectual property (IP).Perth’s isolation distances the city from industry decision-makers and investors. Furthermore, the city’s physical dispersal often leads to weak connections between creatives. CI associations are inclined to be small, and below the size needed to deliver the scope of services required by boutique CI businesses. Significant benefits can be reaped by improving the business capacity of CIs workers, or their access to business capability, as well as exploiting improved communications technologies. Initiatives likely to offer the greatest opportunities to redress existing shortcomings include: global niche marketing services, business intelligence, joint venture facilitation and CI business skills development. These and other challenges are documented in detail, in the accompanying report.

Page reviewed 25 June 2019