Music News

New study puts music industry COVID losses in the spotlight

It’s been two long years since COVID rolled around and ruined our fun — and now we can put numbers on the financial hit felt by the concert and music industry. 

A new report from Statistics Canada found that “industry revenues declined by a record $783.8 million from 2018 to $1.8 billion in 2020, falling to their lowest level since comparable data became available in 2014. With losses in operating revenues outpacing those of operating expenses (-$635.4 million), the operating profit margin for the industry fell 2.6 percentage points to 10.4% in 2020,” according to the report. 

That’s a 31% drop in operating revenue, with for-profit companies losing even more — a 41% drop between 2018 and 2020, while nonprofit organizations losing $166.3 million. 

Even when venues could reopen, there were hurdles to overcome in terms of capacity. This presented a different kind of decision: was it worth considering different ways of offering entertainment? 

 “For businesses that could operate, reduced audience capacity or alternatives to in-person shows required constant adjustment, resulting in 31.0% of respondents adopting or expanding contactless business models and 14.6% investing in e-commerce platforms,” the report says. “To help mitigate falling revenues amid the pandemic, many businesses worked to find substitutes for regular in-person performances, such as live-streamed digital performances or online viewing passes for pre-recorded shows. As a result, e-commerce sales expanded as a share of total sales, accounting for 23.9% of all sales revenues in 2020.” 

Grants have helped to allow venues and businesses to keep some employees on the payroll, helping mitigate the pain of dropping salaries, benefits, and commissions, which declined at a slower rate, of 25%, compared to other operating expenses. 

Looking at provincial losses, Quebec venues and operators lost more than any other place in Canada ($352.1 million) from Covid-related closures, followed by Ontario ($192.6 million), Alberta ($28.3 million), and British Columbia ($18.5 million). Pre-pandemic, those four provinces provided 94.9% of all industry revenue. 

Ontario’s just starting to lift its latest round of COVID-prompted restrictions, allowing venues to open at 50% capacity for the time being. Bands are rescheduling tour dates and releasing optimistic-looking spring and summer calendars filled with shows with the expectation that decreasing illness rates and increasing vaccination numbers, combined with outdoor show possibilities, will help them get back out on the road. Time will tell but it’s looking brighter now than a year ago. 07

The full StatsCan report can be read here.

Amber Healy

I write about music policy and lawsuits because they're endlessly fascinating.

Amber Healy has 520 posts and counting. See all posts by Amber Healy

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