Attracting Artists to Communities Essential to Success
| 2016 Q3 | story by SUSAN TATE | photos by Steven Hertzog
An international marketing agency located in downtown Lawrence, Kansas, since 1999, Callahan Creek is a creative force in design and marketing, a collective of thinkers and makers, and an active part of the creative economy of Lawrence. Cindy Maude, CEO emeritus of Callahan Creek, moved the business from Topeka to downtown Lawrence because of the area’s creative energy.
“One reason we have been so supportive of enhancing and promoting the Lawrence Cultural District is because we know that an environment strong in arts and culture attracts companies like ours that provide quality employment and strong community support,” she explains. “Companies in the creative sector attract similar businesses, create new jobs, increase the tax base and bring new dollars into the community.”
With $13 million in annual sales, Callahan Creek’s decision to relocate to Lawrence proves what a 2013 Ewing Marion Kauffman Foundation report entitled “How Cities Can Nurture Cultural Entrepreneurs” details: In today’s competitive environment, a compelling quality of place—a community’s cultural attractiveness to existing and future residents and workers—is a competitive advantage. Motivated by executives’ increasing concern over their businesses’ growth prospects in a tight labor market, companies choose locations attractive to the mobile, millennial workforce. Artists, designers and other young professionals decide where to live and then where to work; therefore, governments are only one component of complex ecosystems that attract top private-sector talent and support startups. A vibrant creative identity has always mattered in Lawrence, where we have long celebrated our bohemian spirit; but cities that take steps to complement the organic presence of creative professionals with creative sector-focused economic development strategies and policies advocating planned investment in culture will lead the country in local GDP growth.
Attracting the talent for creative, technology and bioscience sectors requires quality of life. Necessary and sufficient infrastructure matters, but place is more than proximity to highways and rail systems, telecommunications capacity and tax incentives. Quality of life transcends climate and low crime rates in attracting business investment and human capital. Investment in culture means welcoming libraries, public art, community arts spaces, coffee shops, vibrant downtowns and walkable and bikable neighborhoods with gathering spaces.
Direct Economic Benefits of Arts and Culture
The arts industry supports jobs, generates government revenue and catalyzes municipal economic development efforts. Artists are businesspeople who market their work, pay taxes and add value to all investments. Spending by nonprofit arts and culture organizations in the United States, a small fraction of the entire creative industry, is $61.1 billion annually, and arts audiences spend another $74.1 billion. Patrons who attend concerts, theater productions and exhibitions spend an average of $24.60 per person in addition to the price of performance tickets per event. Kansas nonprofit arts organizations pay taxes, market Lawrence and contribute to efforts to attract and retain businesses.
The business of art is important to the Lawrence economy. The Lawrence Free State Festival, with $75,000 from the City of Lawrence, $150,000 from other sponsors, in-kind donations from the Lawrence Arts Center and partners, and concessions and ticket sales had a 2016 budget of $350,000. The Festival generated more than $700,000 in local business sales and more than $100,000 in city tax dollars in 2016, according to the Kansas Board of Tourism. The marketing reach for Lawrence is tremendous, and the Festival, still in its infancy, will have National Endowment for the Arts funding again in 2017.
According to Americans for the Arts, the Lawrence Arts Center alone, with 350 contracting artists and employees, and a $3 million budget, annually contributes $317,559 in city tax revenue, $353,870 in state revenue and nearly $5 million to Lawrence household income.
Visual and performing arts professions in the for-profit and nonprofit sectors are businesses themselves, and their recognizable presence in a community signals culture, talent and tolerance to individuals and businesses seeking to relocate.
“Random collisions,” involving what Saul Kaplan calls “unusual suspects,” happen in cities where talent and ideas are densely packed into common spaces. The author of “The Business Model Innovation Factory” asserts that these collisions necessary to innovation happen in culturally rich cities. Such culture is increasingly valuable in corporate location decisions and to how self-employed creative professionals, including artists, decide where to live and invest.
The culture of a place instills a sense of belonging and promotes attraction and attachment to a community. The 2010 “Soul of the Community” study conducted by the James L. Knight Foundation and Gallup surveyed 26 communities and found a positive correlation between community attachment and local GDP growth. Communities with the strongest attachment enjoyed local GDP growth of 6.9 percent, while those reporting the lowest attachment levels grew by just 0.3 percent. Three primary factors determine a resident’s sense of attachment: social offerings, openness and aesthetics. In the competition for skilled labor, quality of place and the attachment it creates will increasingly drive location decisions.
Artists identify themselves as self-employed at a rate much higher than the general professional population, at 48% according to the 2000 U.S. Census. Because more artists than any other professionals have latitude of choice about where to live, their absence or presence in community is an indicator and predictor of quality of cultural life that will draw high-tech, creative, and knowledge-based businesses—because they know the presence of artists indicates robust cultural life.
Lawrence artist Clare Doveton has had studio space in Lawrence’s Warehouse Arts District, six blocks east of downtown, for four years. In Clare’s experience, “Businesses have more opportunities to thrive around similar businesses, and an arts business is no different. Having my studio in close proximity to other artist studios is an endless resource. There are dozens of painters, printmakers, ceramicists, metal sculptors, photographers and builders. My canvases are stretched by a craftsman nearby; my framer is across the street. Collaborations come to fruition from talking about work over coffee or in random meetings on a Final Friday. When buyers or galleries come to my studio from Kansas City or Chicago, they are interested in experiencing other things that happen here in our art community and always explore nearby studios and galleries and food and drink. And when completely different buyers and galleries come to visit the artist next door to me, they will visit my work, as well. We work together here in the business of art.”
Like other businesspeople in the Warehouse Arts District, Clare benefits from the random collisions made possible by a combination of public and private cultural investment.
Callahan Creek, a host of other creative-sector businesses at all stages of their development and individual artists, designers and other creatives make Lawrence home because this city gets it; but support for this quality of life should become a core piece of our city’s economic development strategy.
Attracting and Retaining Human Capital
The premium on openness and aesthetics in flourishing urban areas is no accident, argues Richard Florida, American urban studies theorist and author of “The Rise of the Creative Class.” If jobs follow people, and if the most mobile and well-educated sector of our economy are “creatives,” and if they choose where they wish to live based on social offerings, openness, and aesthetics, thriving cities will make these investments.
Cities that prioritize public safety, mental health, infrastructure, business parks and affordable housing at the expense of investment in cultural initiatives will fail to compete for the most talented, creative professionals and business investors.
Tequa Creek Holdings is a small but fast-growing software company in Downtown Lawrence, Kansas, with gross revenue of $1 million annually. As the company shifts its focus from consulting to a product-centric model projected to fuel significant growth in the next five years, its need for highly skilled technical talent and creative professionals will continue to increase. Tequa Creek General Manager Robin Bayer understands the best candidates for these jobs will come from the ranks of millennials who focus first on where they want to live and then look for work opportunities that support their lifestyle. “If we cannot find these talented folks in Lawrence, we will have to consider relocating to other markets where creative professionals want to live,” Bayer says. The culture of Lawrence is essential to attracting professionals such as those Tequa Creek and Callahan Creek employ.
Midwestern Success Stories
Newsweek magazine recognized two Midwestern mayors as among the five most innovative mayors in the country. Sly James, of Kansas City, Missouri, created and led the Mayor’s Task Force for the Arts, resulting in Kansas City increasing its investment in arts and culture, and watching the accompanying transformation of the cityscape, along with new private support following public investment in arts and culture. The Office of Culture and Creative Services was initiated by the Task Force. This team works with city leaders to codify arts and culture as part of specific strategies to attract business, increase tourism, and leverage technology to benefit the arts. Announcing the new team, Mayor James stated, “Arts and culture play an integral role in civic life and provide the education, economic development and vitality which will move our city onto the world stage, where it belongs.”
Mick Cornett, in his fourth term as the Mayor of Oklahoma City, recognized in the 1990s that quality of life in Oklahoma City meant that no companies would consider relocating regardless of government incentives. He led an initiative to build a Civic Center Music Hall, a new main library, a canal to help redevelop a warehouse district and a series of dams on the river to create recreational spaces. Oklahoma City is now ranked as a top place to visit in 2016 by USA Today. Entrepreneur Magazine ranked Oklahoma City as the No. 1 city to move to to launch a business. In June 2016, the technology website Gizmodo cited Oklahoma City as one of three American cities offering good jobs, affordable housing and a high quality of life. “If you look across the world at cities widely known for their high quality of life, you will invariably find communities that support and embrace the arts in all its forms. Our community’s support of the arts has played an integral role in Oklahoma City’s renaissance,” writes Mayor Cornett, who is also President of the United States Conference of Mayors.
Since the recession of 2008, motivated by competition for economic development more than philanthropy, cities around the country have sought new ways to support artists and arts organizations by providing workspace, incorporating artistic work into municipal projects and training artists as entrepreneurs. These investments illuminate what is distinctive about a city and are essential to branding and recruitment efforts.
Tony Krsnich, of Flint Hills Holdings, saw this potential in East Lawrence five years ago. Krsnich explains, “Art plays a major role in our economy. I have seen firsthand the catalytic effects it has had in East Lawrence. When we developed the Poehler Lofts, we purchased local artwork to hang in the common areas, a simple yet uncommon innovation, and we immediately began to talk in terms of artists’ studios in the surrounding buildings. We set a national record and leased all 49 units in 11 hours.”
The Poehler Loft Apartments won multiple local, state and national awards. It led to the redevelopment of the remaining blighted buildings on the block and won the 2014 National Development of the Year Award for the Cider Gallery. Krsnich built more artist lofts at 9th and Delaware streets; all 43 were leased in a month. Office incubators, art co-working space, a bistro, cross-fit, a film production company—all contribute to an extremely vibrant up-and-coming area, and Krsnich made affordable housing an important part of the mix.
“In five years, we have invested over $20 million into a previously blighted block, created over 30 permanent jobs and attracted several businesses to Lawrence who were previously out of town or looking to move,“ Krsnich reports. “The presence of art and artists is why the Warehouse Arts District has been successful and why, in our developments, it will never be an afterthought.”
Action and Policy at the Municipal Level
Cities can affect economic, educational, cultural and social change in a way that federal entities cannot. Cities can see the interrelatedness of local cultural identity, social attachment and cohesion, and attractiveness to the labor force and corporate investment. According to the Kauffman report, as federal support for the arts has diminished, direct expenditure in the arts by county and municipal governments has been increasing across the country as cities learn that cultural investment attracts business investment.
According to Grantmakers in the Arts, a national network of private, public and corporate arts funders, to compete for workers and businesses, municipal and county governments have increased direct expenditures on the arts each year since the 2008 Recession. In the 2013 Ewing Marion Kaufmann Cultural Entrepreneur study, Anne Markusen, director of the Arts Economy Initiative and the Project on Regional and Industrial Economics, at the University of Minnesota’s Humphrey School of Public Affairs, wrote, “Since the Great Recession, North American mayors and city councils have boosted investments in arts and culture to improve the quality of life, to attract residents, managers and workers, and to welcome visitors. Many city leaders are newly aware that artists bring income into the city, improve the performance of area businesses and creative industries, and directly create new businesses and jobs.” Arts organizations and artists are a vital part of the economic systems of cities that know how to attract and retain businesses.
The Ewing Marion Kauffman Foundation, in Kansas City, recommends city leaders implement the following strategies:
1. Know who your artists are.
2. Encourage convening and equipment-sharing centers for artists.
3. Develop sustainable artists studios and live/work buildings.
4. Provide entrepreneurial training to artists.
5. Include artists in city-development strategies.
Mayors James and Cornett, the Ewing Marion Kauffman Center, business leaders and artists in Lawrence know that planned, visionary, sustained investment by cities in public art, designed gathering spaces and the imprimatur of artists can be a deciding factor when talented individuals decide where to live and where the most desirable businesses decide to locate. The positive effect of winning these individuals and businesses on the gross domestic product of a city are easily calculated, but the return on investment does not stop there.
The decision of Callahan Creek to relocate to Lawrence in 1999 meant that Lawrence’s Barteldes Seed House, a beautiful and historic limestone building at Eighth and New Hampshire streets, was preserved and restored to house Callahan Creek and other businesses. Their employees volunteer at local not-for-profits; they are engaged in the development of a cultural district here; they teach interns; they buy local art; they worked with the school district to create our ConfabuLarryum. What Callahan Creek would call Lawrence’s “Brand Juju” drew them here and allows them to attract a highly talented workforce, yet they see continued need for investment in the culture of Lawrence and for recognizing the value of creative-sector business to our local economy. The decision of Tony Krsnich and Flint Hills Holdings to turn a blighted area into the Warehouse Arts District resulted in preservation, affordable housing, artist space and the startup incubator spaces where Tequa Creek had its beginnings—all part of a vision that supports artists and enhances what Gallup calls the “soul of our community,” essential for the hyperlocal business of nurturing entrepreneurship, attracting talent and supporting incumbent businesses.