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Otis College releases 2022 report on California’s creative industries

A poll of readers, now in its 15th year, found that 85 percent of respondents agreed or strongly agreed that the Otis report is a crucial resource for tracking California’s creative industries. | Image courtesy of the 2022 Otis College Report on the Creative Economy

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Otis College of Art and Design in cooperation with economic research and planning offices CVL Economics released the 2022 Otis College Report on the Creative Economy, showing that jobs in California’s creative industries have rebounded strongly after early numbers during the pandemic showed the creative industries had been hardest hit. A poll of readers, now in its 15th year, found that 85 percent of respondents agreed or strongly agreed that the report is a crucial resource for tracking California’s creative industries.

The report covers five creative industries: entertainment and digital media, visual and performing arts, architecture and related services, creative goods and products, and fashion. Employment in these industries has fallen 85 percent in Los Angeles County since 2007, while California employment has increased 15 percent, compared to 22 percent in 2019.

The report pointed to a number of macroeconomic conditions that have had a profound impact on California’s creative industries. The recession hit many sectors in the second quarter of 2020 and high inflation remains a concern, although not affecting all sectors and households equally. Supply chain issues continue to plague the economy, fueling inflation and most notably disrupting creative goods and products from the creative industries, with the composition of the workforce changing significantly due to the economic shutdown.

At $358.9 billion, California’s creative industries accounted for 11.8 percent of the state’s total gross regional product. Overall, creative industry jobs in California more than doubled from nearly $76,000 to $158,000 between 2007 and 2020, compared to a 53.7 percent increase in wages across the economy. In Los Angeles County, creative wages increased 64.7 percent compared to 41.7 percent overall.

The fashion industry accounted for 2.8 percent of California’s GDP. The industry continues to lag in both California and Los Angeles County, largely due to the long-term decline in production in the United States. Employment initially stabilized following the loss of some employees due to the Great Recession, but started falling again in 2014.

The industry employed 52,000 workers in 2020 and saw a 14.4 percent drop in employment from a year earlier due to the pandemic. The report divides the fashion industry into five sub-sectors: Textiles & Fabrics, Apparel, Leather Goods, Jewelry, and Personal Goods & Cosmetics. Of the five industries, the apparel sector holds the largest share of jobs in fashion and provides more than three times the employment in cosmetics, the second largest sector.

The apparel sector lost jobs steadily between 2007 and 2020, with a 22 percent post-pandemic decline nationwide. Most of the job losses were in white-collar rather than self-employed, totaling around 450 across the fashion industry nationwide, changing the composition of the workforce. Between 2007 and 2020, the fashion self-employment rate nearly doubled in California, from 6.1 percent to 11.7 percent, and more than doubled in Los Angeles County, from 3.6 percent to 7.9 percent.

Employment in the textiles and fabrics subsector fell by 49.7 percent and 54.7 percent between 2007 and 2020 in California and Los Angeles County, respectively; However, wages increased significantly, with over 70 percent growth in the state and a 77 percent increase in Los Angeles County, resulting in a median annual wage of around $52,000.

The leather goods sub-sector proved to be the most resilient to employees, largely due to its position as a smaller segment. Wages also rose 65 percent in California and just over 40 percent in Los Angeles County between 2007 and 2020.

Fashion workers tend to be female compared to workers throughout the creative industries. The jewelry and personal goods subsector serves as an outlier, with 63 percent of workers identifying as male. The fashion sector is more racially diverse than the general workforce in both Los Angeles County and California. However, black employees are still underrepresented.

The report also highlighted innovation and technology, particularly used and resale platforms, that have benefited from the shift to e-commerce during the pandemic, and how companies such as Poshmark, DePop and threadUP converted promoted goods into purchases. Also noted were the alternative, augmented and virtual reality technologies that have transformed the way consumers shop, whether online or in person.

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