Comparison of the GDP of culture and other sectors of the economy
Culture is about 3% of the Canadian economy, roughly the same as oil and gas extraction
I whipped up today’s post essentially to share one graph with you: a comparison of the direct impact of the arts, culture, and heritage on Gross Domestic Product (GDP) with select other industries. I hope that you’ll find it as interesting as I do.
I created the graph for a French-language presentation that I did for the Fédération culturelle canadienne-française last Wednesday. The presentation described key economic terms, highlighted different elements of the economic impact of culture (beyond the direct impacts included in today’s graph), and offered a few other stats about the cultural sector. For those who read French, the presentation is available here.
I’m keeping it simple today: no calculation of per capita figures, no other adjustments, and no comparison with government investments, which I did a couple of weeks ago. Just the direct economic impact in billions of dollars.
Only the direct economic impact of culture can be (easily) compared to other industries. Elements such as indirect, induced, and ancillary impacts are often not comparable, because the methods used to estimate these impacts tend to differ from one study to another. My presentation described each of the impact terms (direct, indirect, induced, and ancillary) in more detail.
Another reason for the focus on the direct economic impact is that these amounts for each sector actually add up to Canada’s total GDP. If we were to include the spillover effects in other industries, then every industry would account for a portion of the GDP of every other industry.
The four comparison sectors were chosen because (a) their impacts are in the ballpark of the estimate for culture (some higher, some lower) and (b) I thought that they might be interesting to you.
There are two data sources:
For culture, the data come from the Canada-wide estimates in Statistics Canada’s culture indicators for 2022.
For other sectors, the data are drawn from Statistics Canada’s calculations of GDP by industry.
Unlike my series of reports in the fall, I am using the industry-based estimate for culture, not the product-based one. Statistics Canada has indicated that the industry-based estimate is comparable to the GDP of other industries. 2022 is the most recent year for the industry-based estimate.
As I noted in the French-language presentation, GDP is a net economic indicator. It expresses the economic value added, in contrast to “output”, which is essentially a measurement of total revenues. Gross output is the starting point for the estimate of net value added.
Culture compared with other sectors of the economy
OK, almost time for the graph. First, I should note that the comparisons are a touch imperfect. The imperfection lies in the fact that I could not find (despite really, really looking) GDP estimates for the comparison sectors that are expressed in unadjusted “current” dollars, rather than “chained” dollars (which provide more appropriate comparisons from one year to the next). By my rough calculations, the difference could be up to 10% or so. In other words, the comparison sectors in the graph are understated by about 10%. The comparison sectors have a much larger difference with culture than 10%, except for oil and gas extraction. That’s why my description of that difference is not definitive.
Here’s what the following graph shows:
Culture had $73 billion in direct impact on GDP in 2022. This is very similar to the direct impact of oil and gas extraction ($71 billion), an area that (I think) is often believed to be much larger than culture. The direct impact of culture is larger than some other sectors, such as accommodation and food services ($44 billion) and agriculture, forestry, fishing, and hunting ($41 billion). The direct impact of culture is smaller than transportation and warehousing ($92 billion) and retail trade ($112 billion).
I should note that oil and gas extraction is a component of a larger sector in the industry statistics, one that also includes mining and quarrying. The full industry’s impact on GDP was $110 billion in 2022.
For the record, there are other sectors that have much larger direct impacts on GDP. Here are a few examples:
Manufacturing: $207 billion
Health care and social assistance: $183 billion
Finance and insurance: $167 billion
Construction: $165 billion
Culture: About 3% of the overall economy
How big is culture compared with the overall GDP of Canada? About 3%, but again, the comparison is imperfect.
It was surprisingly difficult to find the overall GDP of Canada expressed in actual “current” dollars, not “chained” dollar estimates. Oddly, a dataset that could have provided information in current dollars only has data until 2021, the year before the one I need!
The dataset that I used for other comparisons shows the overall GDP of Canada in 2022 to be $2.2 trillion (or $2,194 billion), in chained dollars. The $73 billion direct impact of culture represents 3.3% of this total. However, chained dollar estimates are a bit smaller than current dollar estimates, according to other data that I examined. Based on that, I have estimated the overall GDP to be around $2,466 billion in current dollars. The result …
The $73 billion direct impact of culture represents 3% of Canada’s GDP.
Notes
Sources: Statistics Canada, Table 36-10-0453-01, Culture and sport indicators by domain and sub-domain, by province and territory, industry perspective, 2022 and Table 36-10-0434-03, Gross domestic product (GDP) at basic prices, by industry, annual average.
Today’s post relates to very broad statistics, those for the overall cultural sector (which I also call “the arts, culture, and heritage”). These statistics include all nine areas captured in Statistics Canada’s economic data, including six main areas (called “domains” by Statistics Canada):
Live performance (including performing arts as well as cultural festivals and celebrations, excluding government-owned organizations, which are captured in “governance, funding, and professional support”.)
Visual and applied arts (including architecture, advertising, crafts, design, and works of art)
Written and published works (including books, newspapers, periodicals, and other published works)
Audiovisual and interactive media (including broadcasting, film and video, and interactive media, excluding government-owned organizations, which are captured in “governance, funding, and professional support”)
Sound recording (and music publishing)
Heritage and libraries (including non-government-owned libraries, archives, cultural heritage, and natural heritage. Government-owned organizations are captured in “governance, funding, and professional support”.)
Also included are three supporting domains:
Governance, funding, and professional support (including, among other items, all government-owned cultural venues, which are therefore not counted in other areas, e.g., heritage and libraries, live performance, visual and applied arts, etc.).
Education and training (including cultural programs offered at educational and training establishments)
Multi domain (including items that could not be allocated to a specific domain)
The estimates relate to culture industries, i.e., the production of cultural and non-cultural goods and services by establishments within the arts, culture, and heritage.
For an analysis of the most recent data related to culture products (with no comparisons to other sectors), please see my series of reports in the fall: