2Scale of the creative industries in Scotland
7.The creative industries are hugely important to the Scottish economy, employing tens of thousands of people and contributing billions of pounds to the Scottish economy. However, there are questions about the exact size of these industries in Scotland, and whether the different figures produced by the UK and Scottish governments act as a barrier to better co-ordinated policy.
Data on the size and economic contribution of the creative industries
8.The UK and Scottish governments each produce their own figures for the number of people employed in the creative industries in Scotland. The Scottish Government puts the figure at 71,000,5 while the UK Government puts it at 102,000.6 The UK Government also produces figures for the “creative economy”, which includes creative workers who are not employed by a creative enterprise. The UK Government puts the number of people employed in Scotland’s creative economy at 174,000.7 These differences are largely down to the different definitions used by the UK and Scottish governments,8 but there are a number of other issues with assessing the scale of the creative industries in Scotland, including:
- The small size of many creative enterprises in Scotland means they are not captured in employment and economic data.
- Creative enterprises do not always have the right industry code—which is used by the ONS and Companies House to classify the area a business works in—applied to them.
- Many datasets do not distinguish between the creative industries of the UK as a whole and those based in Scotland.9
9.The UK Government told us that, across the whole of the UK, the creative industries were worth £76.9bn in 2013, equating to 5% of the UK economy, but that it was not possible to break down this figure for the constituent parts of the UK.10 The Scottish Government’s own assessment of the economic contribution of these industries in Scotland found that they had a turnover of £5.8 billion in 2014.11
10.As well as the size of the industry overall, it is also important to consider the size of individual creative enterprises. In Scotland, unlike other parts of the UK, particularly London, they are predominantly small and micro enterprises. The Scottish Government’s written evidence stated that, of the 13,825 registered enterprises operating in the sector in March 2014, 97.9% were small (0–49 employees).12
11.We have been told that there is a need for better data about the creative industries in Scotland to ensure that policy is formed on the basis of sound evidence.13 We have also been told that it would be helpful if the UK and Scottish governments agreed a common methodology for measuring these industries, so that there was a shared understanding between both governments.14
12.Addressing the importance of accurate data to forming policy affecting the creative industries, Jo Dipple, the Chief Executive of UK Music, told us that in order to assess whether a policy was good or bad you needed to be able to measure its impact.15 Brian Baglow, from the Scottish Games Network, made a similar point with regards to the games industry, telling us: “until we understand the scope, the size and the locations of the games industry here in Scotland, it is very difficult to do anything effectively, based on actual hard data”.16 Creative Skillset supported a more joined-up approach with regard to assessing the scale of the creative industries between the UK and Scottish governments and told us that: “In developing a universal understanding of employment in the sector, the two Governments should agree on a common methodology for measuring and assessing the sector.”17 Fiona Hyslop MSP, the Scottish Government’s Cabinet Secretary for Culture, Europe and External Affairs, told us that data on the creative industries did present a challenge, but that the Scottish Government did not want to “create an industry out of statistics”.18
13.When we asked the UK Minister of State for Culture and the Digital Economy, Ed Vaizey MP, how the lack of clear, consistent data on the creative industries in Scotland could be addressed, he told us:
I myself have torn my hair out in frustration in terms of how you define particular sectors and how those statistics are collected.
[…]
I would certainly be up for seeing whether we could come up with a survey that perhaps better reflects the complexity and sophistication of the creative industries. […] I do think it is worth a robust discussion and I certainly would not rule out […] having a separate survey that was done effectively by the industry, in conjunction with the Government, better to reflect what I think is a much more interesting economy than perhaps the official statistics show.19
He also said there was scope for the UK and Scottish governments to discuss how they came up with their estimates for the size of the creative industries, and see if there was some way to “meet in the middle”.20
14.In addition to the general issues regarding data on the creative industries in Scotland outlined above, we have also been told of particular cases where research has seriously underestimated the size of a sector in Scotland. Brian Baglow, from the Scottish Games Network, told us that a 2012 Economic Contribution Study of the computer games industry in Scotland was “one of the most wrong-headed pieces of research ever produced” and that it had underestimated the size and value of the sector in “almost incalculable terms”.21 The study stated that the computer games industry in Scotland directly employed around 200 people, and reported gross value added (GVA) of less than £10 million in 2010.22 These findings were the subject of significant criticism from the industry, which argued they grossly underrepresented the scale of the computer games industry in Scotland.23
15.Brian Baglow suggested that the research “had done a great deal of damage because there are policies being made that use this as hard evidence.”24 When we challenged Creative Scotland on this point, Janet Archer, Chief Executive, told us that: “when that report was produced, we did not account for the full extent of the scale and size of the games sector in Scotland” but added that this had since been addressed.25 However, when we took evidence from the computer games industry we were told that there was still “no real hard and fast data out there about the size or the scope of the games industry in Scotland.”26 TIGA—a trade body for the UK’s games industry—told us that they conducted an annual survey of the computer games industry, which they felt gave a reasonably accurate picture of this sector.27 However, their figures on the proportion of the UK’s games industry made up of Scottish enterprises differed substantially from those produced by Ukie, another industry body representing the UK interactive entertainment industry.28
16.The different definitions used by the UK and Scottish governments for the creative industries mean that there are two completely different figures for the scale of the creative industries in Scotland. There are also issues around how smaller enterprises are captured in government data. The absence of comprehensive data regarding the creative industries in Scotland, and the lack of a common definition of these industries across both the UK and Scottish governments, can only inhibit effective policy formation and joint-working by the two governments.
17.We recommend that the UK and Scottish governments work together to establish how a robust assessment of the creative industries in Scotland can be achieved, and then carry this work out with a view to publishing the assessment by December 2016. This will ensure that policy decisions are made on a sound, evidential basis, and mean it is clear whether policies are supporting growth of the creative industries. The work should consider the UK Minister’s suggestion of working with industry to take forward a survey to better reflect the complexity and sophistication of the creative industries.
5 Q199
6 Department for Culture, Media and Sport, Creative Industries: Focus on Employment, June 2015
8 Q66
9 Live Music Exchange (CIS0015) para 4, Professor Robin MacPherson (CIS0031), Design Council (CIS0036) para 12, UK Music (CIS0041) para 9, Alliance for Intellectual Property (CIS0044), Q224
11 Q199
13 Q4 [Brian Baglow], Q226
15 Q226
16 Q4
18 Qq199-200
19 Q256
20 Q257
21 Q4
22 DC Research, Economic Contribution Study, June 2012
23 TIGA, Video Games a vital part of Scotland’s creative industries, September 2012
24 Q4
25 Q172
26 Q4 [Brian Baglow]
27 Q3
© Parliamentary copyright 2015
Prepared 12 January 2016