Theater and performing arts industry

Industry Snapshot

GENERAL INDUSTRY: Arts and Entertainment

CAREER CLUSTER: Arts, A/V Technology, and Communication

SUBCATEGORY INDUSTRIES: Broadway Musicals; Circuses; Dance Companies; Las Vegas Style Spectacles; Live Performances; Musical Dramas; Opera

RELATED INDUSTRIES: Motion Picture and Television Industry; Music Industry

ANNUAL DOMESTIC REVENUES: Performing arts, spectator sports, and related industries: US$102 billion (Plunkett Research, 2021); Performing arts companies: US$16 billion (First Research, 2023).

NAICS NUMBERS: 711, 7111, 7115

Summary

The theater and performing arts industry includes organizations that produce or organize live presentations involving performances of actors, musicians, dancers, musical groups, and other entertainers. This industry includes the promotion and production of these events as well as providing the artistic and technical skills necessary for the production of events. The group includes a very wide range of businesses and encompasses nonprofit as well as for-profit entities. The group ranges in size from small businesses, including individual freelance performers, to large organizations such as large opera and theater production companies. Many nonprofit organizations are dependent on significant financial support from government and private-foundation grants. The industry is represented in numerous countries and is most developed in metropolitan cities. In the United States, performing artists are more educated on average than the workforce as a whole.

History of the Industry

The practice of presenting live artistic performances dates back to ancient times. Ancient Greek and Roman cultures included dramatic, tragic, and comedic poetry and theater. During the sixteenth century, commedia dell’arte, an improvised comic theater with stock characters, flourished in Western Europe. The roots of current repertoires and performing traditions can be traced to the early seventeenth century, when Williams Shakespeare’s plays were written and the first public opera house was opened in 1637 in Venice, Italy. The modern symphony orchestra developed in Germany during the mid-eighteenth century.

Today’s large performance organizations, particularly opera companies, originated from the traditions of European royalty. Many modern performing arts organizations were formed during the eighteenth and nineteenth centuries; Italy’s famous opera house, La Scala, opened in 1778; the first performing circus in the United States opened in 1793, Broadway musicals began in the early 1800s, the New York Philharmonic was created in 1842, the Boston Symphony Orchestra was created in 1881, and New York’s Metropolitan Opera House opened in 1883. In the United States, wealthy patrons started many of the large performing organizations. For example, J. P. Morgan, Andrew Carnegie, and Joseph Pulitzer were important contributors to the New York Philharmonic Orchestra. Numerous artistic leaders and performers were brought from Europe to lead many of the major performing arts organization in the United States.

Many historians identify modern theater’s beginnings in 1901 with the founding of the Moscow Art Theatre by Konstantin Stanislavsky. He formulated a revolutionary method of acting and is credited with beginning the modern age of the artistic director in theater.

The modern tradition of ballet dance performance was developed in France by King Louis XIV in the mid-seventeenth century, and in Russia during the mid-eighteenth century. Modern dance traditions departed from ballet in the late nineteenth century. New American theater dance forms such as tap and jazz were developed in the mid-twentieth century.

Major performing arts companies in the United States were aided in the early twentieth century by the creation of tax-exempt status for nonprofit organizations. In the United States, a few large organizations were created in major metropolitan cities on the East Coast in the late nineteenth and early twentieth centuries; attendance of performing arts entertainment in the United States grew rapidly in the post-World War II era. The creation of the National Endowment for the Arts in 1965 also increased public support for the performing arts industry. After World War II, an increasingly educated and wealthy population with more disposable income and leisure time increased the demand for artistic performances in many cities. Numerous regional, permanent nonprofit theater companies, symphony orchestras, and opera companies were subsequently created in other North American cities.

European higher education institutions employed significant numbers of performing artists during the nineteenth and early twentieth centuries. During the mid-twentieth century, American college and university systems developed another significant segment of the performing arts industry by forming schools specializing in the performing arts.

The Industry Today

The performing arts industry today offers several types of entertainment, including symphony orchestras, theatrical plays and musicals, operas, dance performances, circuses, and large multidiscipline spectacle-style shows. Large metropolitan cities continue to provide the majority of employment opportunities for performing artists. For-profit performing arts organizations generally are focused on popular entertainment, such as musical theater production companies and Las Vegas-style spectacles such as Cirque du Soleil. Nonprofit organizations generally focus on art performances, such as symphony orchestras, opera companies, dance companies (including ballet), and regional theater companies. Performing artists also are often self-employed as freelance performers and teachers in private dance and music studios.

Professional symphony orchestras often provide live weekly concerts in midsize to large cities. Led by a single conductor/music director, they usually feature a large group of local musicians, often paired with a single internationally known virtuoso soloist. While some symphony orchestras offer only classical repertoire, many offer both classical and popular repertoire, usually formatted in separate concert series and marketed to different groups of patrons. To attract new audiences, orchestras are using a growing number of new concert formats, including shorter “rush-hour” concerts and concerts with multimedia presentations.

New York’s Broadway is the center of the theater world in America. The highest-profile plays and musicals are produced there; sometimes, Broadway shows spawn touring productions that play in large and midsize cities across the country. Productions of Broadway shows also often have extended runs in large cities; New York, Los Angeles, Las Vegas, Toronto, and Chicago are large enough to support several major shows running simultaneously for months or years. Metropolitan communities also may support regional theater companies. Plays and musicals typically employ numerous performers, including instrumentalists, singers, dancers, conductors, and actors; many stage roles require performers to have high-level performance skills in singing, acting, and dancing. Theaters often employ a technical staff that assists in the production of most performing events. Technical theater positions include lighting designers, carpenters, costume designers, stage managers, and technical directors. Large theater companies that produce works with significant commercial appeal are located in major metropolitan cities such as New York, London, and Chicago. Regional theater companies often produce new plays and challenging works that do not have the popular appeal necessary for production on Broadway.

Dance companies are led by an artistic director/choreographer and usually specialize in one tradition—ballet, contemporary, folk, modern, or jazz/tap. Many of the largest dance performance organizations are ballet companies. Dance companies generally have a home theater for most of their performances, although some tour as well. Many ballet companies have an affiliated school that trains young dancers in the distinctive style used by the company.

Large hotels and casinos in Las Vegas and some other gambling and entertainment centers produce live performances of popular music and theater. Well-known performers in rock and roll, country, and popular music perform concerts for large audiences at these venues. Smaller venues in casinos also host performances by local musicians. Casinos and hotels rely on individual contractors to hire performers.

Military organizations in the United States and some other countries are among the largest employers of performing artists. All branches of the United States Armed Forces maintain high-quality music ensembles for ceremonial, entertainment, and educational purposes.

Many corporations that operate cruise ships employ numerous performers, including musicians, dancers, and actors, for the entertainment of cruise patrons. Performers often are employed for contract periods of three to six months. Churches and other religious groups regularly employ trained musicians as organists, pianists, and directors of choirs and other music ensembles. Dance bands, pop, rock-and-roll, and country bands often are employed in nightclubs. Employment generally is for single or weekly engagements at the discretion of managers and owners.

Public and private primary and secondary schools employ performing artists as teachers. Universities employ numerous performing artists as educators and performers. One of the primary goals of many universities is leadership in the arts for the enrichment of their communities; this requires a significant commitment of resources and creates employment for performing artists in music, dance, and theater.

Cooperation between universities and performing arts companies (principally regional theater companies and orchestras) is common in midsize cities. These cooperative agreements to hire performers reduce labor costs and allow the organizations to attract higher-quality performers and artists than they could independently. Performers also may find employment in related industries such as film and the music industry.

The performing arts industry has different primary sources of economic support in different regions of the world. In Europe and Asia, support comes largely from government subsidies. In the United States, the industry is supported by a blend of public ticket sales, private donors, private foundation grants, and government grants. Many large performing arts organizations seek to create a reliable funding source by creating an endowment. Performing arts audiences are dominated by highly educated individuals with high income levels.

The performing arts industry continues to face economic challenges. While the economic efficiency of many industries has increased over time, the performing arts industry has been unable to increase productivity substantially. The performing arts industry remains less efficient economically than other industries because its unique live performances are consumed at the point of production. The solution to the fundamental economic problems facing the performing arts industry continues to be philanthropic support and increasing government subsidies. In the United States, much of the government support comes through the National Endowment for the Arts and each state’s arts council.

In the early twenty-first century, countries with growing wealth, such as the United Arab Emirates, increased the import of performing arts from Europe and North America. At the same time, the performing arts industry in North America faced significant challenges stemming from the global economic downturn. Many performing arts organizations have had significant budget difficulties resulting from loss of value in endowments, reduced demand, and decreased philanthropic support. For-profit organizations generally have had better financial success in recent years than nonprofit organizations.

Industry Outlook

Overview

The outlook for this industry is that it will experience growth. The US Bureau of Labor Statistics (BLS) projects that employment in arts and design in general are projected to grow about 3.8 percent between 2022 and 2032. Between 1970 and 1990, the number of artists doubled in the United States, growing at twice the rate of the overall labor force. This growth reflects the great expansion of theaters, orchestras, and other venues in the industry and collegiate community. In recent years, the number of performing artists as a percentage of the US population has more or less stabilized and the rate of growth of the industry has been the same as the rate of the overall labor force. The stability of this measure suggests that the performing arts labor force has reached a balancing point in the overall US economy.

According to the BLS, about 3.1 million Americans identified the performing arts, design, spectator sports, and media industries as their major area of employment in 2022. The BLS reported that California, New York, Texas, Florida, and Illinois were the five states with the highest employment levels in the industry; at the same time, the five metropolitan areas with the highest employment levels in the industry were New York City, Los Angeles, Washington, DC, Chicago, and Atlanta. Performing artists are more likely to have college degrees than other members of the labor force; they receive relatively less compensation for their education level and are more likely to be self-employed.

The performing arts industry is reliant on the ability and willingness of consumers to spend disposable income, the ability of individuals and families to give philanthropic gifts, and the support of government agencies and private foundations. The global economic crisis of 2007–9 created significant loss of performing arts funding from all of these sources. Most performing arts companies experienced significant loss of revenues and budget difficulties in the 2010s. This situation was compounded by the effects of the 2020 global COVID-19 pandemic, which shut down many venues and limited crowd sizes and travel. However, as the effects of the pandemic began to subside in 2022, the outlook for the industry was more optimistic.

Employment Advantages

According to the U.S. Bureau of Labor Statistics, the performing arts industry did not grow significantly in the 2010s and into the 2020s. Employment in many of the performance sectors of the industry will remain challenging in the near future; the advantages of the industry are likely to be found in the management positions within performing arts organizations. Performers in the United States may seek to increase the stability of their income through multiple sources of employment, often including the combination of performance employment with educational employment in institutions of higher or secondary education.

Opportunities outside the United States are more likely to grow in the near future; performing artists willing to relocate to the large cities of Europe, Asia, or the Middle East may find advantages. Large cities with concentrations of significant wealth, such as Monaco, Dubai, and Singapore for example, are likely to maintain significantly higher levels of funding for the performing arts early in the twenty-first century.

Annual Earnings

On average, the performing arts industry in the United States receives half of its annual income from tickets sales, 40 percent from donations and private grants, and 10 percent from government support. In the near future, domestic performing arts organizations will be negatively affected in all these revenue areas. Some experts believe that the late 2000s economic recession taught performing arts companies and executives difficult lessons about budget management, and that, in the long term, the performing arts will also likely be more resilient as a result. According to IBIS World, between 2018 and 2023, the performers and creative arts industry had a 0.4 percent annual growth, with a $57.4 billion market size in 2024.

Bibliography

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