A framework to determine the contribution of the creative industries to the South African economy

Abstract

The role of creativity as an economic resource is being linked to future economic growth and development within the knowledge economy. The creative industries gained prominence in 1998 when the Department of Culture, Media and Sport in the UK released economic estimates in their first ever mapping study. This led to a worldwide recognition of the creative industries as well as multiple national economic estimates of the creative industries combined with policy and developmental strategies through public and private partnerships. However, in South Africa, there has been a lack of research on the creative industries and the economic value associated with it. Therefore, the goal of this study was to develop a framework to determine the contribution of the creative industries to the South African economy. To achieve this goal, the first objective was to assess the creative industries and related concepts through a detailed discussion on the topic in the form of a literature review. This literature review assisted in the identification of the creative industries along with the evaluation of the major models in order to estimate the economic value of the creative industries. The second objective was to study the relationship between the creative industries and tourism by defining, analysing and exploring concepts by means of a literature review. The creative industries and tourism enjoy a rich relationship with much potential for mutually beneficial collaborative partnerships. The third objective was to evaluate macroeconomic components relevant to the estimation of the economic value of industries within the framework of the national accounts and to develop the framework necessary to estimate the economic value of the creative industries in South Africa. The fourth objective was to estimate the contribution of the creative industries to the gross domestic product of South Africa, to evaluate the trade of creative goods and to determine the number of employment opportunities created in the creative industries. Ten accounting tables were used to achieve this goal. It was found that the core creative industries contributed 3.05% to the South African GDP in 2017, that is R155 billion, and the supporting industries had a share of 2.24% of the GDP at R115 billion, which is a total share of 5.29% of the GDP. The creative industries contributed 2.53% to the Gross Value Added of South Africa which is R105.6 billion. The core creative industries had a Gross Fixed Capital Formation of R14.1 billion in 2017 and the supporting industries, R13.3 billion. The total value of the export goods and services within the creative industries was R44 billion in the core industries and R12 billion in the supporting industries in 2017. The trade balance for creative goods was R202 million which is a positive sign for the exports of creative goods. In 2017, creative goods were exported to the value of R16.1 billion, whereas creative goods were imported to the value of R15.9 billion. All the labour in the creative industries regardless of being creative have earned R2.1 trillion in remuneration for formal labour and R117 billion for informal labour and, since 2010, total remuneration has been growing by an average of 3% annually at constant prices, which have been adjusted to take inflation into account. The supporting industries accounted for R42.8 billion in total remuneration. A total of 449 216 people are formally employed within the core creative industries while 100 456 are informally employed which represents 3.4% of employment in South Africa. A total of 179 224 people are employed in the supporting industries of which 148 287 are formally employed. A total of 609 374 creative workers are employed across all industries in South Africa. Of the total number of creative workers, 233 930 (38%) are female. The total value of intermediate input from the creative industries in the tourism industry is estimated at R62.6 billion and the total intermediate input from the tourism industry into the creative industries is R30.5 billion. The literature contribution of this study lies in the analysis of the creative industries concepts, definitions and classifications within the South African context. This is the first thorough literature review based on the complete set of creative industries as well as the creative tourism aspect in South Africa. This study contributed to the methodology of the creative industries discourse with the development of a framework that can be used in research relating to the creative industries. It was recommended that the framework developed in this study be used by the Department of Arts and Culture on an annual basis in order to advocate for stronger developmental policies. The development of a creative industries satellite account was also recommended.