1   St Petersburg and the international experience

Creative Industries1

'Those industries which have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual property'1

Media and Live
Film, Interactive leisure software and computer services, Music, Performing arts, Publishing, Television and radio

Design and Visual
Advertising, Architecture, Crafts, Design, Designer fashion, Visual arts

Heritage
Art and antiques market, Heritage, Museums and galleries

1.1 What are the creative industries?
Creative industries is the term used to describe entrepreneurial activity in which economic value is linked to cultural content.  Creative industries bring together the traditional strengths of classical culture with the 'added value' of entrepreneurial skills and the new knowledge-based electronic and communications talent. While enhancing the economic impact of the familiar cultural giants, creative industries place particular emphasis on the contemporary, because without experiment and engagement with modernity culture cannot renew and revitalise itself.  The creative industries are thus the source of the innovation and competitiveness essential to urban cultures in the swiftly changing and globalising world.

In post-industrial cities in Europe, the USA and the Far East creative industries strategies have been adopted as key elements in social and economic development.  These policies have been shown to:

•	avert unemployment
•	create jobs for young professionals
•	support the restructuring of industry 
•	contribute to growth in traditional manufacturing
•	demonstrate the value of contemporary culture and innovation 
•	develop the knowledge economy, 
•	provide the 'soft' infrastructure of cultural tourism
•	facilitate the regeneration of run-down city districts
•	bring new life into redundant historic monuments or industrial buildings
•	work effectively to socialise marginalised groups.
.
The support services introduced as part of creative industries strategies are often focused on fostering the development of small and medium-sized businesses, but it is important to note the equally entrepreneurial role that can be played by creative individuals within large state or governmental institutions and by private organisations whose essential goals may be non-commercial.  Experience has shown that the support this activity requires should be specific to the creative industries and tailored to meet their particular needs. Creative industry skills can be used throughout the cultural sector, but also in industrial and other manufacturing.

In the Creative Industries Development Partnership, words omitted here the city governments of St Petersburg, Helsinki and Manchester share commitment to promoting this sector in Russia's 'cultural capital'.  St Petersburg's outstanding heritage and live arts, its forthcoming Tercentenary and the City Administration's goals of developing cultural tourism and restructuring manufacturing industry make a creative industries policy especially important.

Of the EU project partners, Helsinki can demonstrate very recent success in combating economic decline through creative industry development.  Manchester has revitalised its city centre and ensured its post-industrial economic health through arts-lead development strategies; the city has set up a pioneering creative industries support service and leads a Europe-wide development network. 
St Petersburg's rich heritage and classical performing arts give it outstanding potential as a world cultural city, but the survey revealed that the creative industries are less well developed.  Although there is a range of established creative enterprises, some of the conditions in which they work, and the lack of a specialist support mechanism diminishes their potential for contributing to the city's economic and social life. 

This section outlines the relevance of the Creative Industries Development Partnership to St Petersburg's current developmental tasks and relates the St Petersburg situation to the recent experience of Helsinki, Manchester and other cities, both as justification of the ideas contained and a stimulus to the development lines described in the concluding section.

1.2  Why are the creative industries important for St Petersburg?

The Governor of St Petersburg has declared that the new social, economic and geo-political conditions prevailing today require strategies to make the city truly competitive both in Russia itself and on the world stage.  Among these strategies, he cited the importance of capitalising on St Petersburg's cultural, scientific and industrial strengths to promote innovation, to restructure industry and develop cultural tourism.2 

The creative industries are key contributors to achieving success in these three areas.

Innovation   

The core added value in the economy of the future will derive from creative processes, from the knowledge base and from the intellectual property rights so created.  Creative industry practitioners develop and practise the innovative skills that are required in all areas of the economy:  in industry and commerce, in the public and private sectors.  The characteristic small size of the majority of enterprises in this sector provides the environment where statistics have demonstrated that innovation and creativity are concentrated.  More specifically, the digital media organisations and clusters of business that are part of the creative industries are major drivers of post-industrial economies.  St Petersburg has strong skills in this area - the development of creative industries market intelligence is needed in order for the city to realise its full potential. 

Manufactures 

St Petersburg's former military-industrial manufacturing met the high specifications of defence-sector requirements.  In the current period of industrial restructuring, the growth of small businesses should play an important role in easing the transition:  they do not need large start-up investment, have a quick turnover of resources, show high growth dynamic and are flexible and responsive to market trends.  But the specific character of small creative enterprises is also important, because St Petersburg's manufacturing industry will have greater potential for international competitiveness if its managers embrace the creative industries skills of design, marketing and branding, distribution and quality control.  As the consumer economy grows, markets will be won by manufactures benefiting from the added value of style, image creation, digital marketing and advertising that can be provided by the creative industries. The markets responding to this change are highly specialised, very volatile and have complex value circuits which demand the focused production typical of creative industries enterprise. The transportable nature of much creative work - images, designs, text, sound, ideas and digital commodities - make s the industry a natural global player.

Cultural tourism

As St Petersburg approaches its Tercentenary, use is being made of this opportunity to attract investment and market the city as a destination for cultural tourism.  Tourist average spend in a city like St Petersburg can be up to $400 per day, but St Petersburg - with current all-visitor totals of 3.9m per annum, but a specifically tourism total of less than 1m3 - has yet to realise its potential in terms of visitor numbers, but also in terms of the contemporary experience it can offer them and the full economic benefit received.  The creative industries provide the ‘soft’ infrastructure of tourism development – the small, arts-oriented enterprises that create local fashion, small consumer goods, galleries, shops, style for restaurants, bars and cafés, that city visitors enjoy discovering independently.  The existence of this kind of infrastructure is a major factor encouraging visitors to stay longer and pay return visits.  It also maximises the economic benefit a city receives through the welcoming of visitors.

Social impact

The aims listed above are economic, and it is important to emphasise this aspect of the creative industries' activities.  Their work can also be described as 'enterprise in the cultural sphere', in which case the expectation is that the activity requires some kind of funding outside its own efforts and is unlikely to be self-sustaining.  So it is worth - as above - focusing on the key role played by the creative industries or 'enterprise in the cultural sphere' in developing the economic strength and competitiveness of St Petersburg.

But of course creative industries also meet the main social goal of St Petersburg's development strategy: 'to establish a favourable social environment', which includes increasing employment opportunities and 'supporting entrepreneurial initiatives'.4 Key actors in the creative industries are small enterprises, whose impact is identified by the State Council of the Russian Federation's recent (Moscow, 2001) Kontseptsiia gosudarstvennoi politiki podderzhki I razvitiia malogo predprinimatel'stva v RF  (Strategy for State Policy to Support and Develop Small Enterprise in the Russian Federation) as 'securing the formation of a middle class, the main guarantee of social and political stability in society;  the creation of jobs - including youth employment . . .; lowering levels of unemployment, social tension and economic inequality' (page 3).

In the international experience, creative enterprise activity is not the prerogative of the kind of businesses defined in Russia as having profit as their main goal (see section 2).  Creative entrepreneurs in most of Russia's European neighbours may also be what is currently identified in Russia as non-commercial organisations or even an entrepreneurial unit or individual functioning within a large governmental organisation like a museum or theatre.  Creative entrepreneurship is practised in all sectors, and practitioners move easily between privately and publicly funded projects and programmes, and indeed funding 'mixes' involving both state funding and private investment are especially favoured. Small amounts of governmental funding - if used strategically - often serve the function of levering in considerably more investment from non-governmental sources:  other supporters are encouraged to participate by this endorsement from the state.

The key is that cultural enterprise 'has the potential for the creation of wealth and jobs'.  In other words, it enhances the sustainability of the cultural organisations, large and small, whose activities enrich the experience of the city for its inhabitants, potential investors and visitors alike.

1.3  International case histories

The creative industries are the most dynamically growing sector in the economies of Europe and beyond.  In the USA cultural industries had by 1998 overtaken aircraft-manufacture as the biggest export earner, employing over 10 per cent of the population - some even say up to 20 per cent.5 In Europe the figure is around 5 per cent and rising.6   Statistics for 2001 show that in the UK the creative industries generate approximately £112.5bn annually in revenue ($157.5bn), accounting for 9.2 per cent of gross domestic product, and employ 1.332m; exports account for 9 per cent of revenue or £10.25bn ($14.35bn).7 

UK governmental surveys made in 1998 and 2001 showed increases over the three-year interval:  industry revenues + 19 per cent; employment + 18 per cent; exports +  2 per cent.8   The UK Office of National Statistics established that the percentage of gross domestic product at current basic prices, as contributed by the creative industries, rose from 6.7 per cent in 1992 to  9.2 per cent in 1999.9  In Britain music exports overtook those of engineering at the start of the 1980s;  the 1998 governmental survey found that Britain's musicians, actors and film directors generate $99bn annually for the British economy -  more than either agriculture or mining;  the UK's theatre, film, television and music companies export about $13.bn of goods and services annually - 16 per cent of the world market - and contribute $41.25 to the country's gross domestic product.10

St Petersburg's partners in the Tacis project have useful experience.    As well as a series of working meetings in St Petersburg, the Tacis project provided for a programme in Helsinki, when members of the St Petersburg City Administration and creative industries practitioners joined together to study that city's successful experience of facilitating creative industries development in the past decade and the supportive framework provided.  The programme concluded with a study of creative enterprise in Manchester and innovative models for funding it. 

Helsinki
Finland, like Russia, occupies a position on the north-west periphery of Europe:  its small size and its specific history dictated the post World War 2 policy of raising the country's European profile.  During the February 2002 Study Programme the Deputy Mayor of Helsinki, I.-C. Björklund, described how in the past decade promoting culture in the city became a tool to achieve this national goal of the Finnish Government, with a series of cultural festivals (Night of the Arts, City of Light, mass open-air concerts like the Total Balalaika Show), culminating in the 'European Cultural Capital' programme in the year 2000.11  He outlined the expanded role cultural activists now play in public life, meeting also the  social agenda of programmes such as art in hospitals, social/work adaptation of criminals and rehabilitation of drug addicts, as well as 'social inclusion' projects involving old people's homes, disaffected youth, and multi-ethnic schools,.

In the post-industrial economic environment of the past decade the Finnish Government has sought to develop the country's high-tech capacity, with the more recent 'Finland Content' programme fostering the creative input of artists and musicians to fuse with computer communications as part of the digital revolution.  In Helsinki, especially graphic illustrations of the official emphasis placed on the creative industries in this area were:  the city centre, city-owned Glass Palace Media Centre for advice and education and its Cable Book Library with 21 free-access computer work stations, but also the new Lume Centre for audio-visual production, education and research at the Helsinki University of Art and Design, with its state-of-the-art 500-m2 studio facilities.  The Cable Factory - a 53,000 m2 redundant industrial building - was donated to independent creative-industries managers for artists' and enterprises' work space in 1990; after 10 years the entrepreneurial success in managing and developing the former factory makes it possible to invest an annual Euro1m (approximately US$900,000) in the continuing renovation of the building.  In 2002 the Cable Factory receives no public subsidy, but offers exhibition space, concert venues and other facilities as well as providing working premises for 900 artists and creative entrepreneurs, who pay rent charges that vary according to the commercial potential of the tenant. In the Uusimaa region where Helsinki is situated in 1998 6.3 per cent of the working population was employed in the creative industries.12

Helsinki Study Programme
February 2002
We saw in Helsinki1 the response to the situation that arose in Europe in the mid 90s as a result of common economic factors and falling subsidies for culture. As in America, European cultural institutions had to learn to earn money. Happily - unlike America - the European institutions were not thrown on the whims of fate: the most important of them were granted help in the form of training for cultural managers who became able to cope with business issues, while the most outstanding business projects received notable financial support in the form of investment funding valued in millions. Special work was undertaken with those heading cultural departments in central and local government to prepare them for work in the new conditions. Underlying the cultural policy of Helsinki's city government is clear recognition that culture is an important sector of the economy, where investment yields returns that may not always be direct, but is important in the shape of the positive 'image' of the city, the favourable investment climate it creates, the jobs it generates - especially for young people - and the lowering of social tension. In Helsinki we studied projects linked to the creative industries, which had received support from Europe, the Finnish government or the city of Helsinki.

Glass Palace
Some 9 million Euros were invested by the city and national government along with the Council of Europe in the reconstruction and equipment of the building as the city cultural centre focused on new media. On the basis of this, the Centre began to earn independently through tenancies and its educational and cultural programme. A flexible pricing policy is operated: some activities are charged for, other popular services are provided free, while the restaurant and a number of cafés operate normal market prices. The Glass Palace's cultural policy was notably well balanced. The influence of cultural policy was seen in the fact that the centre's concept is closely linked with its own immediate past (it was built in 1936 to serve the Helsinki Olympic Games in 1940, that failed to take place due to the Second World War) and that this public function is continued with preference being given to high-level events related in general to Finnish media art. There is a state-of-the-art 600-seat film auditorium, and an education and information complex comprising the central city library with free internet access. These elements are supported by a number of small businesses in appropriate spheres: small music shops, a specialist book printer, small art bookshops and cafés. Glass Palace has annually two million visitors.

Tennis Palace

Up-front investment also made possible the development of new life for a former sports complex. The business element is provided by a cinema multiplex with 14 screens and 2700 seats, while the upper floors provide spacious premises for exhibitions organised as the city-centre headquarters of Helsinki's art gallery, National Anthropological Museum, plus cafés, restaurants and a museum shop selling art books and high-class art giftware. Tennis Palace also draws some two million visitors each year.

Makasiinit Railway Yard

This was the only project that had not received some kind of non-returnable state investment. A tenancy agreement on the former railway marshalling yard in the city centre was reached with Helsinki Administration for a one-year period. Minimal funding was spent on the actual property: the main expenditures being made on equipment. Minimal expenditure goes on services, with provision of heat being left to tenants and other hirers of the facility. Individual premises preserving authentic design and minimally equipped are offered as sports facilities for teenagers, as 'underground' alternative locations for corporate entertaining, as shops selling compact discs, vinyl records and retro clothing and as a venue for pop concerts. The enterprise is impressive for the clever way it makes use of a previously disused and neglected space. In this case, cultural policy is primarily oriented towards the alternative and the mainly youthful consumers of underground culture, creating in the right managerial hands an exotic and valuable product. The project attracts the two target groups most inclined to spending: young people and the middle class. Annual turnover is around EURO 1m, with outgoings kept to the minimum: low rental, minimal spending on services, small staff.

Cable Factory

The city invested the disused factory itself, which was passed into the management of a group of arts-oriented individuals which had been using it and beginning conversion on an independent basis since Nokia abandoned the production of cables there in the 1980s. The necessary restoration work was achieved, in stages and over ten years, by the efforts of tenants and the cooperative management themselves. Income to bring about the upgrading and maintenance of this huge building is earned through providing individual tenancies on sliding scales to tenants ranging from contemporary artists and craftspeople (low or minimal rent), through travel, equipment and other service-oriented firms, to large-scale television and radio companies that pay full market rentals. Income is also earned through leasing the large space of the converted cable hall for mass pop concerts, commercial exhibitions, and even corporate banquets; this cross-subsidises, for example, a low cost contemporary art gallery, as well as smaller exhibition spaces. The management group is now able to invest up to 1 million EURO annually in continued conversion of the building, plus upgraded and increased technical and other equipment. The management group does not impose a strict cultural policy, welcoming exhibitions representing differing arts tendencies. Some 900 people work at the Cable Factory every day.

Kiasma Contemporary Art Gallery

The state museum of contemporary art was set up and is maintained using government and Council of Europe funding. The issue is one of Finland's prestige and national pride, in setting up Europe's easternmost contemporary art gallery at this level. The gallery itself is not financially self-sufficient. The main indicator of effectiveness of any cultural institution in Finland today is its visitor numbers. This means that resources can be attracted from advertisers and the restaurant business, and a number of services be offered. Kiasma works to draw in audiences of all age groups: schoolchildren, pensioners and youth as well as people of working age, drawing up a variety of different programmes. It operates a kind of museum heresy: welcoming into the museum space events formerly not allowed. The best known example is the annual URB festival, specialising in contemporary urban music, texts and rhymes.

Lume Media Centre, University of Art and Design

This is the pride of the University of Art and Design, which has invested large-scale resources from the Ministry of Education. The media equipment is the most up-to-date and extensive and the aim is to raise Finnish media art to previously unattained heights. The investment is partially re-couped by renting out the film, television and sound-recording studios, with faith being placed in the high level of technical equipment. It is projected that this resource will attract top film companies, including those from abroad.

 Analysis of the examples we saw in Helsinki shows that in all cases there was initial investment either from government, local government or European sources, totalling not less than 3 million EURO; there is also a favourable taxation regime and legislation that makes it possible for the main source of income to be sub-letting part of the premises. The ideological basis for all this is the desire for Helsinki and Finland to be part of the European cultural space and the understanding that investment in culture can generate essential economic impact in various spheres. Administratively, all (except Makasiinit) depends on accepted business planning and uses standard management processes.

Today, in conditions operating in Russia, we could make only partial use of the Finnish experience:
1. We must continue to work with the City Administration and the Legislative Assembly Deputies to persuade them about the economic impact of the creative industries in particular and culture as a whole.
2.We must work on ourselves. It's important to understand that for us too the most important indicator that any cultural institution should aim for is visitor numbers. This will undoubtedly influence an institution's cultural policy, but it's quite possible to achieve high visitor numbers without dumbing down our programmes. (High visitor numbers provide us with arguments to offer potential sponsors, advertisers, and investors - as well as the authorities.) 
3. Cultural institutions should expand their infrastructure and diversify, seeking to offer the maximum number of services that are relevant to their main profile.(As well as the standard 'kit' of café, restaurant, small shops, one may make use of Kiasma's experience in offering paid cultural and educational programmes, targeting different sections of the population.)  
4. The experience of Helsinki (and not just this) also shows that the creative industries are most effective economically when they are concentrated in one place: cultural centres where large organisations are neighbours with small ones, art quarters and streets. (This is the best for earning money and for the survival of smaller participants in the sector.)

On the whole, in spite of the fundamentally different circumstances in which culture finds itself in Finland, where the long term Creative Industries project is developing dynamically with moral and financial support from the government, the study programme was exceptionally useful in that it helped us evaluate our St Petersburg possibilities in this sphere and attempt to adapt their experience to our reality. Happily, as a result of this adaptation, some essential elements remain that we can make full use of for ourselves.

Irina Aktuganova, Pushkinskaya 10 Cultural Centre

Manchester
Manchester - a 19th-century industrial capital like St Petersburg, but without its outstanding architecture and classical culture - has used the arts and the creative industries as key elements in its regeneration strategy after the collapse of its manufacturing base and the loss of over 200,000 industrial jobs in 1972-84 alone.  Beginning in the late 1980s, the city authorities worked to reinvent its image, using marketing programmes to project a vibrant, stylish, youth-oriented face, while its development policies focused on schemes with central cultural projects: the Museum of Science and Industry in a redundant railway building, the Royal Exchange Theatre constructed inside the former Cotton Exchange, the renovation of the Castlefield city-centre industrial heritage area, a new, contemporary building for the art gallery and a totally new concert hall, as well as the unique Urbis centre, where the world's first industrial city celebrates urbanisation. 

These capital projects and the micro-quarters of Manchester featuring the small shops, galleries, restaurants, cafés and bars that have sprung up to meet the needs of both the local population and visitors, are estimated to attract 150,000 tourists and internal visitors every day to the vibrant, revitalised city centre.13 There is a climate of economic confidence that has enabled the city to attract huge private-sector investment, calculated at $4-5 for every $1 of public-sector funding, $1.4bn external investment having been attracted in the years 1994-99.  By 1999, the creative industries sector that had grown up in the previous decade was contributing an annual $1.4bn in value to the city budget and 6 per cent of the population were employed in culturally-related jobs.14

Manchester values this input highly, and in 1999 Manchester City Council joined with the regional government authority, the local investment and arts boards and 6 other public organisations to set up the city's Cultural Industries Development Service (CIDS).  CIDS has an annual $1.4m budget to deliver an information, intelligence and advice service to Manchester's independent cultural and creative enterprises.  It works through sub-sector specific trainers and advisors, and is setting up specialist networks dealing with issues ranging from a student employment service to sub-sector market intelligence, training and financial support for small businesses wishing to access and develop international markets.

CIDS

The mission of Manchester's one-year-old Cultural Industries Development Service (http://www.cids.co.uk) is to foster independent cultural and creative businesses in the area of Greater Manchester, providing free services for its target clients in the interrelated urban areas of Manchester, Salford, Thamesside and Trafford.

The services provided include:

•	Comprehensive information and signposting
•	A personal business diagnostic
•	Personalised and informed guidance to funding, business start-up and development
•	Sector-specific professional development programmes
•	Support for industry networks
•	Industry marketing and market development initiatives
•	Business expansion schemes:  financial assistance (up to 50%) for purchase of equipment and product development
•	Export market research and development.

CIDS has a staff of nine. It receives its funding from 10 individual organisations:  local and regional governments and arts boards, the Manchester region's investment and marketing agencies, and representatives of these and other public organisations and private companies guide its activity through membership of the CIDS Management Board.  

CIDS operates as an independent not-for-profit business with an annual budget of £1,4 million. It works to deliver its services through fifteen different partnership relationships. 

Liverpool and Manchester Design Initiative

After London, Manchester is rightly considered the leading centre for design development in Great Britain. This non-commercial agency provides free advice and specialist information for designers, potential clients and relevant specialists. Exhibitions, seminars and publications help develop skills designing ceramics, glass, furniture, web-sites, photography, etc, as part of a total budget of £100,000 funded by the North West Arts Board, Manchester City Council and the European Union. The project database currently carries details of 700 registered designers (www.designbank.org.uk).

'Manchester Independents' music network

Manchester's network for professionals (www.manchester-music.org.uk) is a mini chamber of commerce - a non-commercial self-help organisation founded in 1999 to develop and strengthen the music industry infrastructure, focusing less on creative work than on the economic development of companies and firms in this sphere.  The association unites all aspects of the business, bringing together musicians, promoters, sound engineers, publishers, festival-organisers, lawyers, producers, etc.  The main aims are the exchange of information, the development of the network of professional practitioners and access to resources.  The activity is organised in small initiative groups and committees.  There are regular events in an informal environment, master classes and a link with trade representatives to increase international work. 

Creative industries are now the subject of new economic development policies and structures in cities throughout Europe. As well as the examples given, the cases can be cited of:

Milan
 Milan,15 where there are now some 50,000 creative industries small enterprises, comprising one third of the general total of enterprises, and where one third of the entrepreneurs in the sector are women.  After severe cuts in local industry, the city's economy shifted towards financial services and administration in the 1980s, but from the 1990s investment was targeted into specific creative industries sectors like culture and communications.  The Milanese city authorities have revised their official statistics-gathering system to reflect the new economic sub-sectors that are now recognised. 

Berlin
In the capital of Germany small creative companies and individuals have moved into buildings, factory spaces and institutions made obsolete by reunification and brought about the regeneration of rundown areas.  Developers have followed them into these hitherto unpopular city quarters, because of the innovative, trendy urban ambience that the small cultural enterprises create.  The city now focuses on culture in its marketing and issues publications to promote cultural industry businesses.  The media and communications are the 4th largest economic sector in the city (the recent city reconstruction means that Berlin is one of the best networked and digitalised cities in Europe).

Barcelona
The large-scale urban renovation carried out for the 1992 Barcelona Olympics created new infrastructure, but the city authorities were concerned to ensure that local neighbourhoods shared in the benefits by matching the international aspect of the Olympics with community-based participatory events involving the local creative industries.  Barcelona became well known and a top visitor destination as the result of the Olympics, but it was able to sustain interest because of its diverse cultural events and venues (visitor numbers doubled at this time from 1.6m to 3.2m).  Data based on 2000 estimates that culture represents 5.4 per cent of the gross domestic product of Barcelona (culture is defined as audio-visual, music, heritage and museums, performing and visual arts, libraries and publishing; fashion, design, architecture etc - which could add to the total - are not included here).16

For such cities as Lyons, Rotterdam and Frankfurt the creative industries are also important parts of their development plans. However, perhaps some of the most detailed statistics relate London, whose city authorities see the creative industries as 'central to London's reputation as a world business and tourism centre'.17   

London
A report devoted to London's creative industries finds that 400,200 people are employed in the sector in London, comprising 23 per cent of the national creative workforce, and that they are a significant and fast-growing part of London's economy, generating  £16-£20bn ($22.4-28bn) annual revenue.  It finds that the creative industries:

•	develop skills required by all sectors of the economy
•	have an especially important current role to play in the success of a knowledge-driven economy 
•	play a central role in the regeneration of run-down London districts (such as Clerkenwell, Wapping and Hoxton) 
•	make a significant contribution to social cohesion 
•	create jobs
•	contribute to daytime and evening economies
•	are effective tools in education and skills training.18

The report states that the 13 creative industries account for 10 per cent of the total exports of London.19  (See more statistics in Appendix 1, page XX.)

Notes
1. UK Government's Department for Culture, Media and Sport, Creative Industries Mapping Document, London 1998 and 2001.
2. Leontief Centre, Strategic Plan for St Petersburg, St Petersburg 1998, pp 6-7.
3. St Petersburg City Administration, Committee for External Relations, Saint-Petersburg:  Tourism. Hotels - Statistical Bulletin, SPb, 2001, pp 4-8.  The figures are broken down under three headings for each of three groups of visitors: foreign, from CIS countries, and from the Baltic countries; they relate to visitors to St Petersburg and the North West Region. The three headings are: Tourist visas, Business travellers, Private trips. The total of 3,885,216 is reached by adding together these three headings for all three groups of visitors (excluded are Transit and Crew visits).  If tourist visits alone are considered, the total is 953,889;  foreign tourist visas total is 850,858.
4. Strategic Plan for St Petersburg,  op cit, p.84.
5. Andy Pratt, A Third Way for Cultural Industries, London School of Economics (London), 1998.
6. Charles Landry, The Creative City, Earthscan (London), 2000, p 137.
7. Creative Industries Mapping Document 2001, op cit, pp 10-12; the figure for the rise creative industries share of UK GDP comes from Acting for Creativity in London (see Note 9), p.9.
8. Ibid, Appendix, pp 01-02.
9. London Development Agency et al, Acting for Creativity in London, March 2002, p 9.
10. Guardian newspaper (London), 28.4.98, p7.
11. See a description of this process in Timo Cantell, Helsinki and a Vision of Place, City of Helsinki Urban Facts, 1999, Chapters  6, 7 and 8.
12. City of Helsinki Urban Facts, Background Report for OECD Territorial View of the Greater Helsinki Region, 13.9.2001 (to be published), p 59.
13. Figure provided by Marketing Manchester (Manchester City Council), December 1998.
14. Figures quoted by Andy Lovatt, Director, Cultural Industries Development Service (Manchester), during Helsinki Study Programme, Feburary 2002.
15. These city reports are available on www.mmu.ac.uk/h-ss/mipc/iciss, under:  individual city reports, Transnational Case Studies.
16. Barcelona figures provided by Jordi Pascual I Ruiz, Institut de Cultural de Barcelona, May 2002.
17. Acting for Creativity in London, op cit, p9, which also describes the London Regional Development Capital Fund to be launched in April 2002.
18. London Development Partnership, Creative Energy:  The Creative Industries in London's Economy, LDA and Government Office for London, 2000, p 16.
19. Acting for Creativity in London, op cit, p 4.

APPENDIX 1 
Creative Industries in the United Kingdom and London:  Facts and figures

Abundant data about creative industries development were published in 2000 in the report Creative Energy: The Creative Industries in London's Economy by the London Development Partnership and the Government Office for London.  The information that follows has been extracted from this report.

The creative industries employ 11.5 per cent of London's working population.  They play an important role in two dimensions of London's economy and its future prospects.  They make a substantial contribution to London's wealth, competing in national and international markets with skills, innovation and by providing essential and high value services for the wide range of financial, manufacturing and service sectors.  As importantly, these industries are central to London's reputation as a world business and tourism centre.

1.  Creative industries employment in London

Creative industries sub-sector	
Numbers employed	
Percentage of UK workforce employed in London

Film	
16,300
	
50	

Television and radio	
27,900	
57

Music	
3,400	
44

Performing arts	
21,200	
41

Publishing	
83,300	
26

Interactive leisure software	
58,400	
22

Advertising	
38,600	
46

Architecture	
55,500	
19

Crafts	
8,600	
6

Design	
N/a	
N/a

Designer fashion	
7,400	
18

Visual arts	
13,500	
30

Art and antique market	
7,500	
23

Museums, galleries, heritage	
15,800	
20

Totals	
400,200*	
23 per cent

*  The total represents c. 11.5 per cent of London's full workforce.  It does not include designers, for whom employment figures are unavailable.  32 per cent of all workers in the sector have higher education degrees, which is double the national average.  

Individual workers and firms move between the public and private sectors on a regular basis.  Much public investment is in development funding, supporting the emergence of new creative and managerial talent that may later be located in either or both sectors.

The other main UK locations for creative industries are South East England (advertising, publishing, design);  Manchester (music, designer fashion, sport, television and radio), and Glasgow (design, visual arts).

2.  Secondary impacts

The creative industries have developed a number of important secondary impacts, with the advertising, design and publishing sectors in particular being linked to most other sectors.  

In addition, many of the professional and other service sectors have developed specific expertise in the creative industries, and there is a specialist market for a variety of sectors:  marketing and public relations, insurance and retail.    The concentration of arts, creative and media activity in London has led London's law and accountancy firms to accumulate specialist business and legal advice unequalled elsewhere.  

3.  The role of tourism

Tourism plays an important role in adding value to the creative industries sector.  Visitors are encouraged to London and when in London, to spend both on the industries themselves (through theatre tickets, museum and gallery sales, etc), as well as on indirectly related elements such as food and drink, transport, accommodation and other retail.  Tourism creates an estimated 250,000 full-time jobs in London.

Visitors citing culture as 'important or very important' in their decision to visit the UK:  59 per cent for museums (higher for US visitors); 37 per cent for theatres and art galleries; 34 per cent for performing arts.  In addition, 30 per cent of business visitors cited culture as important.  £645m (US$903m), or approximately 10 per cent, of overseas visitor spending in London is directly on the arts and culture (this figure comes from Employment in the Arts & Cultural Industries, an analysis of the 1991 Census, ACE (London), 1995.

The influence of the London design, fashion, club and visual arts scene led to an explosion in interest in the late 1990s. The reputation for being at the cutting edge of contemporary and street culture helps attract a new generation of visitors.

4.  Industry structure

Company sizes vary hugely in the creative industries. Most of the industries are fragmented and heavily based on individuals, micro-businesses and SMEs.  28 per cent of the workforce are self-employed and work alone;  a further 28 per cent work in companies that employ fewer than 25 people.

The percentage of self-employed individuals is one of the highest for all employment sectors in the UK:  66 per cent of musicians;  43 per cent of clothing designers;  42 per cent in visual art and design sectors;  39 per cent of architects;  37 per cent of photographers, camera, sound and video equipment operators.  Sectors with a high proportion of self-employed and micro businesses include:  Film and television (technicians, performers);  Music and Performing arts (performers);  Architecture, Design, Visual arts, Crafts, Art and antique dealers.

5.  Industry revenues

The creative industries are at the centre of the economies of all of the world's great cities.  Their contribution to the economy is made through investment, employment, the exploitation of intellectual property, and the generation of income from creativity, production, promotion and delivery.

Reliable figures are not available for all creative industries sub-sectors for London, although totals for the UK as a whole do exist; neither UK nor London revenue figures are available for heritage, museums and galleries, or the visual arts.

Table to show industry revenues

Sector	
UK revenue (£bn)	
London revenue (£bn)

Advertising	
4.0	
£3.0

Architecture	
1.5	
0.3

Arts and antiques	
2.2	
1.4

Crafts	
0.4	
0.075

Design	
12.0	
N/a

Designer fashion	
0.6	
N/a

Film	
0.9	
0.7

Interactive leisure software	
1.2	
N/a

Music	
3.6	
1.8

Performing arts	
0.9	
0.3

Publishing	
16.3	
5.4

Sport	
9.8	
n.a

Television and radio	
6.4	
3.45

Total	
59.8	
16.46