Mining a different type of boom: the growth of Australia’s creative services

7 Mar 2013

Mining a different type of boom: the growth of Australia's creative services

By Stuart Cunningham, Queensland University of Technology

There is much gnashing of teeth about Australia’s two speed economy and warnings about the so-called “Dutch disease” – a resources-driven boom that fundamentally imbalances a national economy. The impression that may be left for the 99.99% of the population who are not professional economists is that our best current economic asset (mining) is actually a liability, and the rest of our economy is, if not a basket case, then on the brakes in the slow lane.

Our national conversation needs to break this meta-narrative down into more manageable chunks, investigating where other green shoots may be visible. With the release of the National Cultural Policy scheduled for next week, it is timely to take a look at one of those green shoots: “creative services” in the national economy.

“Cultural production” covers those sectors and occupations that focus on the production of cultural products and experiences for final consumption, and include film, television and radio, publishing, music, performing arts and visual arts. Creative services are business-to-business activities like design, architecture, digital content, software development, advertising and marketing.

The latest evidence from the 2011 census tells a compelling story of the growing role that creative services play in the mainstream Australian economy. Examples include interface designers who have contributed to revolutions in the finance industry, technical writers in online education export, or simulation and games experts who make training environments for mining companies or defence operations.

Australia’s creative employment has grown by almost 70,000 from 463,500 people in 2006, or 5.1 per cent of the workforce, to 531,000 people in 2011, representing 5.3 per cent of the workforce. Almost 370,000 people work in the creative industries and there are a further 161,000 “embedded” creatives – people in creative occupations who work in industries in the broader economy such as banking, manufacturing, defence or government.

Two thirds of creative industry employment is in creative services industries, with the balance of 35% found in cultural production industries. Creative service occupations (221,684 people) have a slightly higher share of creative occupation employment (310,056 people) accounting for 71% of the total, with the balance being in cultural production occupations.

Between 2006 and 2011 the average annual growth rate of creative employment was 2.8% ‑ higher than the general workforce’s rate of 2%.

This higher-than-workforce growth was driven by creative services – creative services industries grew by 4.5% while cultural production’s rate was half that of the workforce. Similarly creative service occupations grew by 3.3% while employment in cultural production occupation grew at only 1.4%.

It is not hard to see why there should be such relatively high growth patterns in creative services and creative service occupations embedded in other industries. The progressive embedding of the Internet and associated digital applications and services into the general economy, especially since the first correction of the dotcom boom and bust more than a decade ago, has seen rapid rises in demand for website design and online visual communication, as well as online and digital advertising, and software data basing, automation and business applications.

Additionally, there are widespread converged digital technologies of reproduction and dissemination (digital cameras, digital video, digital audio creation, sharing online in social platforms) and a growing design-and-communication skill base and consciousness, which supplies people, ideas and applications into the economy, and creates increasingly sophisticated demand in consumers (many of whom are co-producing and disseminating content).

Creative service activity and creative service occupations embedded in other industries are not as subject to the exceptional rules of supply and demand governing the cultural production sector. Harvard economist Richard Caves captured these wittily with epithets like “Nobody knows” (demand is radically uncertain), “Art for art’s sake” (cultural workers care so much about their product they are prepared to work for less than they might get elsewhere or for nothing), and “A list/B list” (there are a few fabulously well-off celebrities but most struggle).

Incomes in creative services are both higher and more evenly spread. Demand for their services is also more evenly spread and more consistently expressed across the economy: every town and city, big or small, needs architects. Almost all businesses, government departments and agencies, community organisations and NGOs need a web presence and experts to maintain and update them. Most pay for advertising and communications. And so on.

On the other hand, cultural production is typified by the “nobody knows”, “art for art’s sake” and “A list/B list” dicta so-named by Caves. What’s more, the consumption of cultural production is tied to discretionary income such that demand is not as great nor as consistent.

It may still be seen as “icing on the cake” rather than the cake. A sustainable “cake” economy is better represented by high-demand creative services.

Research on which this article is based is reported in more detail in the author’s newly-published Hidden Innovation: Policy, Industry and the Creative Sector. The research is supported by the Australian Research Council.

This article was originally published at The Conversation. Read the original article.


Photo Credit: HUS0 via Compfight cc

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