HomeKnow-HowThe Creative Economy 102 - Say hello to the creative industries

The Creative Economy 102 – Say hello to the creative industries

Technology is opening opportunities across industries for new and smaller organisations. Industries and people are connecting in different ways to improve efficiency, offer flexibility and generate innovative businesses and solutions. Due to technological progress, innovation and global awareness, the economy is shifting towards the creative industry to advance and better the world.

This is the second article of a three-part article series on why and how to think about the creative economy. This article will cover the rise of a new kind of worker, present the creative industries as the new leading sector, and report on education and the city-lifestyle from the prism of creativity.

Why you should care about the creative industries

If you’re an entrepreneur, most likely you have an inherently creative vision of humanity, with new ideas and possibilities bubbling up inside you. And the idea that creativity is an essential ingredient of social and business success is becoming universally popular.

By definition, being entrepreneurial means being on the edge of solution-and/or-business innovation. Think about it, and you’ll realise that economic progress, human development, social impact, and happiness (among other things), are very much correlated with creativity.

Why should you care about the creative industries? Generally speaking – and regardless of how you view yourself – you should care about the creative industry because it’s a strategic sector that you should associate yourself with to boost competitiveness, productivity, sustainable growth and ultimately, work opportunities. 

You should care because the creative economy is growing faster than any other economic sector – as complex, challenging creative work is difficult to automate or outsource cheaply overseas (that is if globalisation continues on its current path).

You should care because you need to co-exist with workers that have the ability to adapt, endure and be creative. You should care because you will have to compete in the creative economy and keep up with an endless demand for innovation.

The creative industry sector is not only growing itself, but its spread is also helping to boost other industries. You should care about creating synergies with creative industries – in fact, creative industries will be present in most, if not all organisations in the form of creative/innovation departments or contractors.

And you can appreciate that consumers are becoming ever more conscious; which means that governments, corporations, SMEs, and startups alike are expected to promote social integration, social value and culture. Hence, applying creativity will become a staple function within organisations, just like the marketing, HR, finance or sales functions.

From ‘Made in China’ to ‘Created in China’

Countries themselves are getting involved in making innovation happen, because they have a stake in its outcome. In fact, countries are realising that the more innovation initiatives a government helps launch, the better the quality of life for its citizens will be. 

Economists, governments, private companies, and nonprofits around the world are increasingly recognising the importance of the creative industries as a generator of jobs, wealth and cultural engagement. It’s no coincidence that there is such a focus on entrepreneurial culture in a creative sense and as an approach to economic diversification. 

‘Made in China 2025’ is an ambitious 10 year-government plan designed to boost innovation in manufacturing in China. The Chinese government’s support and market knowledge (China manufactures everything from utilitarian products to high-end-high-value-added technology) are leading a transformation from making foreign companies’ products to developing its own brands and innovation. 

Having realised that innovation is the primary driving force behind development, China is shifting towards creation from manufacturing – it is no longer ‘Made in China’, from now on it is ‘Created in China’.

What are the creative industries?

Measuring the value of the creative economy is not easy and depends on which definition you adopt.

According to Wikipedia, “the creative industries refers to a range of economic activities which are concerned with the generation or exploitation of knowledge and information. They may variously also be referred to as the cultural industries (especially in the EU) or the creative economy (Howkins 2001), and most recently they have been denominated as the Orange Economy in Latin America and the Caribbean.”

According to UNCTAD figures, the global market value of industries that rely heavily on creative and cultural inputs is estimated at $1.3 trillion (to give you an idea, this is approximately the GDP of a country like Spain). The OECD points to annual growth rates of between 5 to 20% in its countries’ creative and cultural industries. As high value added, knowledge-intensive sectors and with real disposable income rising globally, the demand for goods and services produced by the creative industries is anticipated to rise much further, fuelling growth in creative sectors and across the overall economy.

But there are actually many ways to define and measure the creative industries and its different clusters. Traditionally speaking, creative industries combine the creation, production and commercialisation of intangible products and services, often protected by copyright or as intellectual property.

For example, the UK Department for Culture, Media, and Sport (DCMS) developed its own definition of the creative industries, defining them as “those industries which have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual property.”

DCMS’ nine-segment creative industries include:

  1. Museums, Libraries, and Galleries;
  2. Marketing, and Advertising; 
  3. Product Design, Fashion Design, and Graphic Design; 
  4. Architecture; 
  5. Crafts; 
  6. TV, Video, Photography, Film, and Radio; 
  7. Publishing; 
  8. Software, and Computer Services; 
  9. Music, Performing, and Visual Arts. 

In effect, it’s difficult to imagine an organisation not taking part in the creative industries. What organisation nowadays doesn’t rely on advertising, product design, software development or marketing to achieve its mission? 

The new world of work – a global reset

The crisis that began in 2008 has hit the working classes hardest, creating a new postindustrial economy with a differentiated and congenial mix of professionals. The ‘Great Recession’ triggered a global reset encouraging new generations around the world to create new technology, spreading innovation to break through the new frontiers of knowledge and into the first digital civilization. 

Mature economies such as the US, Europe, and Japan, which previously shifted from manufacturing to knowledge work, will now (have to) rely more and more on creative work. And the types of workers taking part in the creative industries is nearly as diverse as the industries themselves. Actors, musicians, architects, museum curators, publishers, editors, software developers, and entrepreneurs with the ‘next big thing’ are all part of the creative industries.

From STEM to STEAM education through creativity

You may have noticed that the word ‘creativity’ is being used a lot lately; this is not coincidental. There is plenty of talk about becoming more creative to prepare for the jobs of the future. But as we’ve seen, creativity is a broad and complex construct, difficult to define and quantify, and still conceptual even when integrated with other disciplines and industries. This is why the ‘creative economy’ is often referred to as the ‘conceptual era’.

With a deeper understanding of what creativity is and its implications for culture and economy in the 21st century, methods of education and teaching will change and are already changing. The promotion of creativity in the last few years, especially in the development of the STEM (Science, Technology, Engineering, Mathematics) subjects to STEAM (STEArtsM), arguably proves the critical role creativity and the arts play in supporting innovation. 

While educators have been combining the STEM subjects for decades in classrooms – the acronym first emerging in the early 2000s – countries and institutions all over the world have since established clear priorities aimed at inspiring more students to pursue STEM studies and the skills they represent for the workforce.

Somewhere along the way, STEM transitioned into STEAM – to the point where some argue that creativity is the secret sauce to science, technology, engineering and maths. STEAM is the new wave of education which proposes that artists, and the creativity they bring to the table, are the key to driving innovation. Art and design are poised to transform our economy in the 21st century just as science and tech did in the last century. 

At the same time, students are placing increasing importance on finding a job that fits their lifestyle, which explores various types of work situations including freelancing, mobile work, co-working, and modern gigs, as well as how to communicate, navigate and network in a variety of scenarios. 

Students are certainly going to face a very different kind of workforce than what their parents faced, as gig work has reached many industries, catalysed by technology that makes it far simpler for companies and contractors to find one another. And if you want to avoid the ‘race to the bottom’ of a price war, it makes sense to develop those skills and qualities that are hardest to commodify – namely creativity and innovation.

The centers of the creative entrepreneurial world – the city

Although the future of the world belongs to the most creative nations, not all people are on track to be creative workers. A key task of the future will be to fully engage everyone’s creative talents.

What seems apparent is that the global creative economy will revolve around and be powered by cities. Cities provide a sort of concentration and diversification – the common denominator that creatives seek and feed from – allowing further cultural diversity to flourish. Cities are central to the global creative economy and the clusters of talent and industries that power it. 

Wherever you go in the world, the pieces will be seen from a different angle, but globalisation means we’re all playing the same game now.

Marte Martin
Marte Martin
Marte Martin is a Madrid-based Venture Associate doing business as Marte Martin Venture Agency, where he focuses on entrepreneurial finance and accounting. You can usually find Marte around the entrepreneurial district of Arganzuela in Madrid or taking part in startup events around the city.

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