Research Commissioned by CultureSource
Since the onset of the COVID-19 pandemic in early 2020, the arts sector has experienced an extraordinary level of uncertainty and financial tumult. Two WolfBrown analyses commissioned by CultureSource aimed to take stock of the financial situation of Southeast Michigan’s nonprofit cultural sector, both to document the effects of the pandemic and to understand coping strategies and sources of resilience, financial and otherwise.
The first paper, “Capitalization Needs of Arts & Cultural Organizations in Southeast Michigan,” was released in July 2020 as an archival and instructive snapshot of organizations thrust into the chaos of scenario planning and uncertainty about how long the pandemic would last and what resources would be available. At the time, the first tranche of forgivable loans was being distributed through the Payroll Protection Program (PPP), although it was not clear how deeply the loans would reach into the nonprofit cultural sector.
The follow-up paper, “Capitalization Needs of Arts & Cultural Organizations in Southeast Michigan, 2021 Update,” offers a second analysis, with research conducted in the fall of 2021 and completed in early 2022. We had planned to begin the research earlier, but the release of grants through the Shuttered Venues Operators Grants (SVOG) program was still ongoing through the fall months and would have had a significant impact on the analysis.
As of the writing of the report, the sector is still emerging from the Omicron surge. Most organizations resumed programming at some point late 2020 or 2021, but demand is uneven. Across the sector audience demand is in the range of 20% to 50% below pre-pandemic levels. Significant questions remain as to when, or whether, demand will fully recuperate.
Our analysis aimed to understand what sustained arts organizations in Southeast Michigan during the second year of the pandemic, what damage was done, what was learned from the first two years of the pandemic, what are the most pressing needs of arts and cultural organizations as they resume operations, and what role philanthropists might play in this work moving forward.