Economic Development

Creative Industries: Trade challenges and opportunities post pandemic

November 30, 2021


Creative Industries: Trade challenges and opportunities post pandemic

November 30, 2021

Matus Samel

Senior manager, Policy and insights , Economist Impact

Matus is a manager on the Policy & Insights team at Economist Impact, based in London. He oversees the execution of projects focused on economic development, sustainable growth, and international trade. Matus has delivered programmes for a number of international clients, including the UN International Fund for Agricultural Development (IFAD), USAID, UK Foreign, Commonwealth and Development Office (FCDO), European Bank for Reconstruction and Development (EBRD), Swiss Agency for Development and Co-operation (SDC), UNICEF, Global Water Partnership (GWP), and many others. Prior to joining the EIU, Matus worked on energy policy, sustainable development, and international trade projects at UNESCAP, Chatham House and Harvard Kennedy School Belfer Center. He holds a Master's degree in Public Policy from Harvard Kennedy School of Government, where he specialised in economic development, energy policy and international trade and competitiveness.

Prior to the Covid-19 pandemic, the creative industries generated around 30 million jobs and accounted for 3% of global GDP, employing more young people (aged 15-29) than any other sector, and with females constituting nearly half of the total workforce.1,2

The pandemic has brought sections of the creative industry to a halt, but also accelerated structural changes within the industry, such as the transition towards digital platforms and a greater role for individual ‘content creators’.

The pandemic has impacted the creative industries asymmetrically. Segments dependent on live audiences and cross-border travel, such as performing arts, theatre and cinema, were hard hit by social distances measures, while digital creative industries boomed. Europe’s performing arts sector lost 90% of its revenue, while its music sector registered a 76% decline.3 The sector also suffered from low state welfare provisions, as most creative industry workers are self-employed or freelancers and therefore not always eligible for job protection policies put in place. In Europe 32% of cultural sector workers are self-employed and lack job protection, a total of 7.3m jobs in the sector at risk, representing 3.7% of total EU employment.4 The pandemic has also accelerated the digital transition of the sector, highlighting the centrality of digital technology for economic resilience. Quickened innovation in digitalisation and technology, as live performance shut down has given rise to streaming platform as well as unique digital creative assets built on the blockchain, like non-fungible tokens (NFTs). Growth has been notable in digital publishing, with the UK seeing a 37% increase in audio downloads, and a 24% increase in digital book downloads.5 The shift to online sales favored players that already had an established online presence, as well as those who swiftly adapted. This is seen to favor the advertising sector, which is forecasted to a strong
recovery in 2021 in the UK, increasing to £29bn in 2022.6 This is largely attributed to the digital shift.

Annual revenue of global entertainment market (US$ bn)

The digital transition shift has given birth to new producer tools, new distribution and dissemination platforms and the rise of the ‘creator economy’. These have profound implications for the sector’s growth, development and international trade. The music streaming and video on-demand revolution has established a new market and increased competitive tensions between players. On-demand video grew by 31% in 2020. There are now 1.1bn online video subscribers online, up 26% from 2019.7 The rise of the ’creator economy’, aided by the emergence of a growing range of tools allowing the production of high-quality content with minimal financial requirements, has also given birth to new forms of revenue in the creator space. One fifth of companies surveyed in a 2019 poll spend at least half their marketing budget on influencers.8, is a niche market that is growing rapidly. The rise of TikTok, for example, has generated US$20bn in sales from China in 2020 and forecasted global sales of US$40bn in 2021.9 

Crucially, as a highly globalised, employment-intensive sector with a significant growth potential, creative industries are an important part of rapid and inclusive post-pandemic recovery. One study estimated that creative industries contributed 4.5% to US GDP – more than construction, transportation, mining or agriculture – and can significantly improve, not merely reflect, the health of the economy following a downturn.10 The creative sector offers economic diversification and can rapidly recover from a downturn, without being impacted by other slow growing sectors, or external volatility. As recognised by the UN, the creative economy has the potential to support developing and transition economies in diversifying production and exports and to deliver sustainable and inclusive development.11


1 UNCTAD, 2021: in,prospects%20look%20bleak%2C%E2%80%9D%20Ms.
2 UNESCO, 2018:
3 The Guardian, 2020:
4 European Commission, 2020:
5 Publishing in 2020
6 City AM, 2021:
7 The Motion Picture Association, 2021:
8 Wired, 2020:
9 Bloomberg, 2021:
10 Douglas Noonan:
11 UNCTAD, 2021:

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