Music powers the American economy according to a new report by economists Robert Stoner and Jéssica Dutra of Economists, Inc. Sponsored by the RIAA the report provides the latest look at the music industry’s contribution to the US economy. The report evaluates pre-pandemic data and documents music’s ability to drive job creation and economic growth, especially as the country’s pandemic recovery efforts gets underway.
According to the report, the music industry contributes $170 billion to US GDP annually and supports 2.5 million jobs nationwide in core music activities like recording, streaming, and live performance, as well as adjacent fields like travel, retail, and marketing. As an export, music generates $9.1 billion in foreign sales annually. And, for every dollar created by music activities, an additional fifty cents is created in adjacent business or fields, illustrating that music consistently performs above its economic weight with a 1.5 times revenue multiplier. For example, in 2018 there were more than 236,000 music related establishments across the United States.
The report also studied the music industry’s contribution to state economies, highlighting results for the biggest contributors, including California, Florida, Pennsylvania, New York, Tennessee, and Texas. In California, 2018 music activities generated over 1.5% of the state’s massive GDP. In Tennessee, music produced 1.8% of state GDP, double the national average of 0.9%.
The impact of the US music industry also extends beyond its boundaries. The United States is home to the world’s biggest music market. According to the IFPI, the global trade body for recorded music, the US accounts for a third of the total world recorded music market and 45% of its total annual growth.
Josh Friedlander, SVP of Research and Economics at RIAA said, “This data provides an important pre-COVID benchmark of the music economy that will guide us as we determine what a return to ‘normal’ must include. It also charts a course for state and federal policymakers to leverage music’s ability to produce strong economic growth and high-paying domestic jobs.”
The U.S. Music Industries: 2020 Jobs & Benefits Executive Summary and Report can be found here.
