Thank you, Madam Chair, for conducting this important study and for the opportunity to appear before the committee today.
All parts of the cultural sector were profoundly affected by the COVID pandemic, although none as deeply as the live performance domain, which includes performing arts companies, music venues, performing arts centres, festivals and many individual artists.
While the business model of the performing arts used to be a successful one, it was definitely not pandemic-proof. Earned revenues from ticket sales, concessions and rentals used to represent as much as 43% of performing arts companies' revenues in 2018. In March 2020, the unimaginable happened: Most of these revenues suddenly disappeared.
According to Statistics Canada's national culture indicators, the real GDP of the live performance domain fell 66% over the first two quarters of 2020 and it stayed there, as successive waves of the pandemic led to rolling cancellations and postponements of performances. There were encouraging signs of recovery during the third quarter of 2021, but those were quickly dashed by the omicron wave.
Employment also fell sharply, although not quite as deeply as the GDP. By the second quarter of 2020, the sector had lost 34,000 jobs, or 47% of its workforce. Thanks to support measures such as the Canada emergency wage subsidy, employment levels stabilized throughout the rest of 2020 and eventually rebounded in the third quarter of 2021, but they are still 38% below prepandemic levels. It remains difficult to predict if this rebound will hold and what employment growth levels might be expected in 2022.
At a town hall held on January 25, CAPACOA members told us that they anticipate challenges in rehiring and retraining personnel. Casual, part-time and contract workers, who were among the first to be laid off, may have taken full-time jobs in other sectors where salaries can keep up with the increasing cost of living. In particular, the scarcity of stage technicians is a big concern. What's the incentive for these workers to come back to the performing arts sector?
Our members believe that sustainable recovery has to involve sustainable employment. The precarious situation of self-employed workers, in particular, is top of mind for everyone in our membership. Through the loss of income arising from cancellations of performances, everyone realized just how vulnerable these artists and technicians are.
Programs such as the tourism and hospitality recovery program and the Canada performing arts workers resilience fund are applauded by the sector, but will they be sufficient? Arts administrators are understaffed and feel overwhelmed by the demands of short-term emergency funding applications and reporting. They are also concerned that these programs may end well before the sector sees the recovery through. Performing arts organizations are currently laying out three- to five-year plans for their rebuilding.
Besides labour issues, the performing arts sector is also very preoccupied with changes in cultural behaviour arising from the collective trauma of the pandemic. After having diligently listened to orders to stay home and to avoid social gatherings for almost two years, many artsgoers are now hesitant to go back to the theatre or the concert hall. According to a national study conducted by Nanos Research, four in 10 culturegoers are not yet ready to return to indoor performances. Another one in 10 says they may never return.
Shared leadership and direct government assistance will be needed to rebuild consumer confidence. We have to shift the public perception of a live performance from a hazardous activity, as it currently stands, to a healthy and positive activity. According to the general social survey, people who attend plays, comedy shows or concerts are 15% more likely to report very good or excellent mental health. Don't we all need this at the moment?
Before concluding, I want to emphasize that with this crisis come opportunities to rebuild new operational and funding models.
The arts sector remains committed to helping build positive and respectful relationships between indigenous and non-indigenous people. Webcasting of live shows is now helping to reach new audiences, although this new practice has yet to find a viable business model.
The experience economy affords great opportunities for partnerships between the arts and tourism sectors.