DALLAS, TX - SMU DataArts, a national center for arts research that provides data-based insights to help arts and cultural nonprofits across the country, today released two new reports and a white paper looking at the financial health of the arts industry leading up to the pandemic:

• The Working Capital report, which provides data on how much money arts organizations have on hand to cover day-to-day operating needs;
• A white paper accompanying the Working Capital report -- Buffering Against Uncertainty: Working Capital and the Resiliency of BIPOC-Serving Organizations -- with surprising new findings about arts organizations that serve BIPOC communities compared to those organizations that don’t focus on these audiences; and
• The Bottom Line report, which looks at whether arts organizations are bringing in enough revenue to cover their expenses.

The Working Capital report is an update of a report issued several years ago that covered the period 2013-2016. The new report covers 2016-2019 and looks at how much working capital arts organizations have on hand based on their sector, size, audience served, geography, and other factors. For example, the average arts organization in 2019 had five months of working capital, but this figure is skewed high by some large organizations. The median, or reality for more than half of the organizations, was the precariously low level of 1.5 months. Working capital varied greatly depending on sector – art museums had almost 11 months’ worth, while dance organizations had only about two weeks’ worth. Institutions in New York had over 9 months of working capital, while those in San Francisco had 1.3 months. And small organizations had more than 7.4 months of capital, while medium-sized organizations had the least, 4.8 months.

The Working Capital report helps answer two questions: From 2016 to 2019, when the economy was strong, did arts organizations take actions to build liquidity to levels that could buffer the storm brought on by the pandemic? And how well prepared were arts organizations that primarily serve BIPOC communities? An examination of the answers is provided in an accompanying white paper, Buffering Against Uncertainty: Working Capital and the Resiliency of BIPOC-Serving Organizations. Co-authored by SMU DataArts Director Zannie Voss and Rebecca Thomas, president of Rebecca Thomas Associates, the white paper shows that organizations of color had more liquidity than their non-BIPOC-serving peers, but that this stability belies factors such as lack of access to capital and revenue and constrained organizational capacity that keep many of these organizations small and make support for them particularly critical.

The Bottom Line report, an update of a report issued in 2017, looks at whether arts organizations are bringing in enough revenue to cover their expenses. The report found that in 2019 there were sharp downward trends, regardless of how bottom line was calculated. The report shows that revenue growth did not keep pace with expense growth, even before the pandemic.