Recession Hits Nonprofit Venues

The U.S. has twice the number of nonprofit theatres today as it did in 1990, according to a recent report by the National Endowment for the Arts, but the venues could be headed for some tough times.

The study finds that individuals and foundations – not government – are the biggest contributors to nonprofit theatres, leaving them vulnerable when those groups face financial crises.

According to NEA chair Dana Gioia, while many theatres boast healthy financial profiles at this point, they’re certainly not recession-proof.

“During both of the last major recessions, total revenue and contributions fell markedly,” Gioia reported. “This vulnerability could create issues for the nonprofit theatre community in the current recession.”

Theatre tickets were also at least marginally affected by periods of recession in 1990-1991 and 2001. Ticket sales dropped more rapidly than contributions during the first recession, the study said, and remained flat as contributions dropped again during the second period.

The drops in sales didn’t seem to be related to ticket prices, however. The NEA found that even a 20 percent hike in low-end tickets reduces total attendance by only 2 percent.

“Audiences appear willing to pay higher prices for events they want to attend,” Gioia explained. “Although further research is needed to explore the issue, the audience drop-off may be more related to issues like lower media coverage, declining arts education, and expanded in-home entertainment options rather than ticket price.”