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Report: Austin Music Is Now A $1.8-Billion Industry, But The Local Scene Is Struggling

Miguel Gutierrez Jr. for KUT News
Demonstrators gathered in the city's Red River District in 2015 to publicly oppose developments that could lead to landmark music venues having to close down, quiet down or move locations.

While the music tourism industry is enjoying a boom in Austin’s city limits, the economic impact of the local music industry — the live music supported by locals during the stretches of the year that aren’t festivals — is on the decline, according to a study just released by Austin Music People

The study, conducted by economic research consultant firm TXP, Inc., says that from 2010 to 2014, the amount of money Austin’s music industry injected into the local economy increased from $1.6 billion annually to $1.8 billion – that includes the impact of both music tourism (festivals like Austin City Limits and SXSW) and the local Austin music scene.

But what that jump doesn’t reveal, Austin Music People points out, is that it’s the music tourism sector that’s booming; revenue and jobs brought in by just the local music industry on its own are actually declining.

That is, from 2010 to 2014, the number of jobs created because of Austin's music-related tourism industry rose by 3,780, a 37 percent increase. In contrast, jobs within the non-tourism, year-round music scene dropped by 1,205, a decline of 15 percent, in the same time period.

What does this mean?  

“Music tourism is very strong," Houlihan says. "What we’re not seeing is the same kind of investment in the local music industry, and that’s troubling.”

AMP cites the addition of a second weekend to Austin City Limits and the construction of the Austin 360 Amphitheater at Circuit of the Americas as two substantial boons to the economic impact of music tourism.

Credit TXP consultants

But, Houlihan hopes that the declining numbers will demonstrate the need for the City of Austin to focus on making it easier for local music-related businesses to cut through municipal red tape.  The permitting system for venues, she says, is “chaotic.”

“That a venue could need 18 different permits from six different offices is kind of absurd. These folks are trying to stay in business, not do paperwork,” Houlihan says. “We think there are ways to get to the same destination without requiring so many hoops.”

Don Pitts, the head of the City of Austin's Music Program Manager, has not yet responded to requests for comment.

But, according to Mayor Steve Adler's office, the city does have plans in the works to help musicians and venues establish more security here in Austin.

“Austin won’t be the Live Music Capital of the World for much longer if we keep losing musicians and music venues,” the Mayor said in an e-mail statement.

The Mayor's spokesperson says that Adler has been working on plans to bring more stability to the local music industry. "This will be a far-reaching and innovative effort that, if successful, will help secure Austin’s role as the Live Music Capital of the World," says Jason Stanford, the Mayor's Communications Director. The Mayor plans to reveal the list of proposed improvements in the near future.

The report concludes that the dichotomy between music tourism growth and the local music industry isn't sustainable. Austin’s local music scene established the industry here and its reputation, which drew tourists and festivals to town. Without that foundation, both industry sectors would suffer, the report says.

“Music isn’t just for people who like to go listen to music,” Houlihan says. “It’s an economic driver for attracting tech companies and other employers to Austin. It provides part-time work for folks; it feeds our souls here in Austin. It’s a lot more than just a guitar on a sign at the airport.”

This story was updated Tuesday with word from the Mayor's office.

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