The Styrian creative economy before COVID-19

Astoundingly resilient

Last year, in 2021, creative industries – and the overall economy in general – suffered greatly from the aftereffects of the COVID-19 pandemic. However, many sectors have also proven to be extremely resilient. Overall, this has even set the creative industries on the upswing.

The creative sector is an extremely heterogeneous field, and the challenges Styrian companies faced in 2021 due to COVID-19 are just as diverse. While the entire event sector was struggling to a significant extent, some other sectors were almost able to boom and increase their value due to their expert knowledge in an entire range of digital skills. All in all, creative industries are proving to be astonishingly resilient. With a range of innovative products and services, they are able to react quickly and flexibly to new circumstances. There are no current figures for the development of the creative sector after the start of the COVID-19 pandemic for 2021, as Creative Industries Styria only commissions an evaluation of figures by KMU Forschung Austria every 2 years. The most recent figures dating back to October 2020 accordingly relate to the period between 2016 and 2018. They attest to an enormously dynamic and exceedingly positive development in the creative sector: 4,800 creative companies (2016: 4,400) are active in Styria, which corresponds to a share of 9% of all Styrian companies. The more than 17,500 self-employed and employed creative professionals (2016: 16,100) generated a turnover of 2 billion Euros (2016: 1.7 billion). The gross value added at factor costs amounts to almost 1 billion Euros (2016: 0.8 billion Euros).

creative companies active in Styria (2016: 4,400)

4,800

These figures show that the Styrian creative economy has improved dynamically in the period from 2016 to 2018. The number of companies and workers has increased by around 9% each. Sales increased by more than 16% between 2016 and 2018, and gross value added by almost 18%. These high increases are largely due to the software and gaming sector, which accounts for 35% of sales and more than 40% of the added value by creative companies in Styria.

The largest sectors are software and gaming, advertising, performing arts, architecture, and books and publishing. Comparatively

generated turnover 2 Mrd

small economic sectors include radio and TV as well as the music industry. Most of the companies based in Styria deal with advertising (22%), followed by software and games development (20%). The sectors performing arts and

Economic sectors of the creative economy: 1. Architecture 2. Book trading & publishing 3. Design 4. Advertising 5. Film industry 6. Music industry 7. Radio & TV 8. Software & gaming 9. Performing arts sector 10. Libraries, museums, botanical gardens and zoos*

creative companies led by women

23%

architecture each represent 15% of Styrian creative companies.

In almost all sectors of the Styrian creative economy, the majority of companies are single member companies. The performing arts sector has by far the highest percentage of single member companies (81%). The film industry (68%) as well as the sectors design (62%), music (59%) and advertising (57%) also have above-average numbers of single member companies. Most architecture firms (52%) employ between 2 and 4 people. Companies with 10 or more employees can be found in the areas of radio & TV (40%) and software and games development (10%).

Shortage of Skilled Labor in the Creative Sector Last year, the shortage of skilled workers prevailing in many other industries began to take increasing effect in the creative sector as well. The outcome of labor shortage, however, is much the same in every sector. The problem for many companies is that while there are sufficient orders, they do not have enough trained employees to process them. This affects companies of all sizes and subject areas, from administrative work and project management to sales and distribution. When it comes to the core competencies of many creative companies, the situation is particularly precarious, as shortages of skilled workers are not only common in interaction design, software development, coding or programming, but also in social media, editorial and content management and Artificial Intelligence (AI) and Augmented Reality (AR) and Virtual Reality (VR) applications.

The situation was only accelerated by the COVID-19 pandemic, as the creative sector has since

increase of companies and workers

9%

increase in sales 16%

seen a sharp increase in demand for digital services due to lockdowns and working from home. As a consequence, companies see themselves in the paradoxical situation of driving digital transformation while also suffering from the shortage of skilled workers due to a lack of resources.

* (This sector was not included in the presentation of the structural data of the study by KMU Forschung Austria, as only a fraction of institutions belongs to the private sector and therefore data is only available to a limited extent.)

Creative Industries Styria

Strengthening the creative economy on the basis of a modern understanding of innovation is the core task of Creative Industries Styria, founded in 2007. CIS focuses on design as well as on the transformative and innovative power of the creative industries.

As a networking organization, Creative Industries Styria acts as a bridge builder and mediator between companies in the traditional economy and creative professionals, with the aim of improving and expanding market efficiency and performance for all involved. The organization creates awareness for the creative sector on a regional and international level and is an essential part of the growth and innovation that drives Styria. Thus, CIS understands creativity as a valuable raw material for intelligent change – after all, the diversity of a vibrant creative economy offers a significant advantage for cross-innovative cooperation within the Styrian cluster landscape.

Creative Industries is active in three strategic areas: Awareness & Location, Impulses & Projects, and Networking & Service. CIS is working in two directions: First, towards sensitizing traditional companies to the achievements of the creative economy, and second, towards connecting the creative sector with traditional companies in the best possible way. Hence, Creative Industries Styria aims to build bridges to the other respective area at two central interfaces. These interfaces can be found between the areas of creation and production on the one hand and between production and distribution on the other.

At the first interface – creation and production – Creative Industries Styria accompanies the exchange between the creative and traditional economy. Projects are developed primarily utilizing the innovative and transformative power of the creative industries. They can fully develop their potential by transforming various areas of the traditional economy, specifically those areas which are primary strong points of the Styrian economy, i.e. mobility, health and green tech. As an organization, Creative Industries Styria provides important support to further innovate this area.

At the second interface – production and distribution – Creative Industries Styria focuses on the worldwide marketing of Styrian products. CIS deploys its international network of people, media and locations to actively support companies in sales, using creativity as a competitive advantage that secures a company's unique selling proposition and clearly positions it against the international competition. Successful collaborations between creative industries and traditional economy also serve as best practice examples to promote further networking and to firmly establish the "raw material creativity" in the entire Styrian economy. Work at both interfaces follows the guiding principle: Created in Styria – Produced in Styria – Sold Worldwide.

New Formats in the Pandemic The resilience of the creative sector was also reflected in their reactions to the COVID-19 pandemic and the associated trend towards online working. Creative Industries Styria responded to these sudden challenges by launching a series of new formats aimed at networking the creative and traditional indus-