NYCs Nightlife EconomyImpact, Assets, and Opportunities Commissioned by The Mayors Office of Media and Entertainment2About the Mayors Office of Media and EntertainmentThe Mayors Office of Media and Entertainment encompasses the key economic and creative sectors of film, TV, theater, music, advertising, publishing, digital content and real estate as it relates to these industries. The office promotes New York City as a thriving center of creativity, issuing permits for productions filming on public property, and facilitating production throughout the five boroughs. In June 2017, Mayor Bill de Blasio announced that the Mayors Office of Media and Entertainment (MOME), led by Commissioner Julie Menin, would support NYCs diverse nightlife community with a department dedicated to its management. The Office of Nightlife cements New Yorks position as a leader in this growing global movement that recognizes nightlifes value to cities, and represents the first time a NYC agency has been tasked with promoting an economically and culturally vibrant nightlife industry.About the Consulting Team The NYC Nightlife Economy report was conducted by a three-firm consulting team: The North Highland Company, Econsult Solutions, Inc. (ESI), and Urbane Development.The North Highland CompanyThe North Highland Company is a global consulting organization serving multiple industries and functional areas. The Firms Consumer, Media and Entertainment, Public Sector and Strategy practices contributed to this study.Econsult Solutions, Inc. Econsult Solutions, Inc. (ESI) provides businesses and public policy makers with economic consulting services in urban economics, real estate economics, transportation, public infrastructure, development, public policy and finance, community and neighborhood development, planning, as well as litigation support.Urbane DevelopmentUrbane Development (Urbane) is a community development venture and certified M/WBE based in New York City. Founded in 2008, Urbane cultivates innovative solutions to build dynamic neighborhoods and positively impact underserved communities. Throughout its long history, nightlife has been central to New York Citys identity. The “city that never sleeps” is a destination for dreamers and doers and an epicenter of creativity. It boasts something for everyone once the sun sets, including opportunities for dining, dancing, performing, socializing, or building a career. Over many decades, New York nightlife has launched cultural and social movements that resonated far beyond the citys shores: from the social consciousness of beat poetry, folk music, and hip-hop, to the rhythms of jazz, salsa, disco, punk rock, and many more. New York nightlife has inspired artists and entertainers to push boundaries, and provided places for people to come together to find community, all of which contributes to the citys distinctive energy. Not surprisingly, nightlife is a major economic, as well as cultural driver for New York City, with more than 25,000 nightlife establishments citywide. In 2016 (the most recent year where standardized data sets were available), the nightlife industry supported 299,000 jobs with $13.1 billion in employee compensation and $35.1 billion in total economic output. This annual economic impact also yielded $697 million in tax revenue for New York City. The popularity of nightlife is reflected in economic activity that has outpaced New York Citys overall economy, driven by a 2 percent annual growth rate in nightlife establishments between 2011 and 2016. The five-year annualized growth rate1for jobs in the nightlife industry was 5 percent, compared to the citys overall job growth of 3 percent. Nightlife wages have been rising at double the annual rate for the city, at 8 percent as compared to 4 percent citywide. Defining the Nightlife EconomyNYCs nightlife comprises five subsectors, and the economic activity that occurs within those subsectors between the hours of 6PM and 6AM:Food Service: Food Service, a subsector that encompasses full- and partial-service restaurants, cafes, and food trucks, is the backbone of NYCs nightlife industry, with 19,400 establishments across the five boroughs. The Food Service subsector directly supported 141,000 jobs, $4.2 billion in wages, and $12 billion in direct economic output. Fine dining is a notable contributor to this subsector; NYC is home to 72 Michelin-starred restaurants, more than any other U.S. city. Bars: The Bars subsector, which includes drinking establishments that primarily serve alcoholic beverages, and nightclubs, comprises 2,100 establishments, and boasts a five-year annualized growth rate that outpaced the nightlife industry as a whole. The Bars subsector generated 13,400 direct jobs, $492 million in wages, and $2 billion in direct economic output. 3Executive SummaryNew York City nightlife is world-renowned, and has a $35 billion economic impact.4EXECUTIVE SUMMARYArts: The Arts subsector, which includes galleries, museums, live performing arts spaces, movie theaters, and Broadway, has 1,800 establishments. Most of the subsectors jobs and wages75 percent and 90 percentare clustered in Manhattan. However, Brooklyn has seen robust job and wage growth in this subsector (10 and 12 percent, respectively). Nightlife in the Arts subsector supported 18,300 direct jobs, $804 million in wages, and $3.1 billion in direct economic output. Venues: The Venues subsector includes concert and entertainment venues, independent venues, informal cultural and performance spacescommonly referred to as “do-it-yourself,” or DIY venues. As of 2016, there were 2,400 establishments in this subsector throughout NYC. Notably, Queens venues have grown by 10 percent in the last 5 years, in comparison to citywide growth of 4 percent. Venues operating at night generated 19,900 direct jobs, $373 million in wages, and $1.2 billion in direct economic output.2Sports and Recreation: New York City offers no shortage of family-friendly nightlife, including arcades, amusement venues, billiards, bowling alleys, and spectator and participatory sports. The Sports and Recreation subsector represents the smallest component of NYCs nightlife industry, with 100 total establishments as of 2016. Nightlifes total impact in this subsector included 3,900 direct jobs, $352 million in wages, and $735 million in economic output.Nightlifes Economic Impact In total, the five subsectors that comprise NYC nightlife Food Service, Bars, Arts, Venues, and Sports and Recreationwere responsible for a direct economic impact of 196,000 jobs, $6.2 billion in wages (or $7.4 billion in employee compensation), and $19.1 billion in economic output. Beyond the economic impact of nightlife businesses themselves, the nightlife sector yields additional benefits for NYCs economy. The goods and services locally purchased by nightlife establishments have an indirect impact in the NYC economy of 25,000 jobs, $1.8 billion in employee compensation, and $5.1 billion in economic output. The induced economic impact of nightlife is the result of spending by those employed directly in the nightlife industry. In 2016, this amounted to more than 29,000 jobs with $1.7 billion in employee compensation and $4.9 billion in economic output. There is also an ancillary impact on NYCs economy from additional spending on retail, transportation, lodging, and other services that happens only because of people enjoying New York Citys nightlife. This ancillary spending supports 48,000 jobs, $2.3 billion in wages and $6.0 billion in economic output. Finally, the nightlife industry generates a fiscal impact of $1.8 billion in tax revenues to New York City and New York State. This includes taxes from nightlife employees, sales, liquor and hotel taxes, totaling $697 million to the City and $1.1 billion to the State.Subsector Establishments Jobs Wages OutputFood Service 19,400 141,000 $4.2B $12.0BBars 2,100 13,400 $492M $2.0BArts 1,800 18,300 $804M $3.1BVenues 2,400 19,900 $373M $1.2BSports the balance (40 percent) work part-time in other non-related industries. Of artists surveyed, 28 percent reported performing at three to five establishments at the time they took the survey. Another 23 percent were performing at six or more establishments. Where they work and live: A large majority of artists (80 percent) reported that they primarily perform in Manhattan, followed by 18 percent who focus on Brooklyn for their performances. Manhattan and Brooklyn were the most popular boroughs for residence, with 39 percent and 23 percent of artists living in these boroughs, respectively. Of the 22 percent who commute from outside New York City, the overwhelming majority live in New Jersey and other parts of New York. Challenges: Eighty percent of artists and entertainers cited lack of income stability as a moderate or major challenge. The lack of benefits and low wages were also cited as challenges. Competition for gigs remains a significant hurdle for performers, with 80 percent citing it as a moderate or major challenge. Sixty-eight percent of surveyed artists pointed out that establishment closures and reduced hours adversely impacted them. Outlook: Despite challenges, over three-fourths of respondents (79 percent) indicated they will still work in the NYC nightlife industry in three years.EXECUTIVE SUMMARYDespite challenges, over three-fourths of artists and entertainers believed they will still work in the NYC nightlife industry in three years. 8Nightlife Employees: Nightlife is a source of employment across many roles: establishment managers, security, chefs and other food preparation roles, bartenders, hosts, service staff, and more. Among 106 survey respondents spanning these roles, the average tenure exceeded 18 years in the nightlife industry. The majority work full-time in their role (77 percent). Forty-two percent of employees surveyed indicated that they worked at one establishment, 23 percent worked in two locations and another 22 percent worked in three to five locations (the remainder indicated that they work in six or more establishments). Where they work and live: Those surveyed work predominantly in Manhattan (74 percent) and Brooklyn (21 percent). Employees reported living in Manhattan (39 percent) and Brooklyn (34 percent) most frequently. Twelve percent reported residence outside New York City. Challenges: Fifty-four percent of survey respondents cited the lack of benefits as a moderate or major obstacle of working in the nightlife industry. Close to half of employees surveyed (49 percent) indicated that income volatility is a challenge. Outlook: Despite challenges, a majority of employee respondents (65 percent) see themselves continuing to work in the nightlife industry within the next three years. Consumers/Residents: Of the 864 nightlife consumers surveyed, 73 percent were NYC residents, while the balance (27 percent) were non-residents (commuters, day-trippers, tourists, business travelers). Most fell between the ages of 21-40 (66 percent), with 32 percent age 41 or older. Where they go: NYCs nightlife consumers most commonly enjoy restaurants (85 percent), bars and nightclubs (73 percent), and live music and concerts (56 percent). Reasons they go out: Consumers engage in nightlife to connect with friends/family (77 percent), to relax and unwind (69 percent) and to experience art and culture (64 percent). Non-residents also have a higher propensity for sightseeing at night (more than 50 percent compared to 22 percent for residents). Influences shaping their choices: Besides their personal preferences and tastes, the top factors that shape consumers nightlife decisions are the opportunity to attend a unique experience or event (93 percent), price or affordability (89 percent), minimal wait time (84 percent), and accessibility via public transportation (83 percent). Challenges: Cost was a top consumer concern, with 66 percent of respondents agreeing that affordability is a challenge to participating in nightlife. For residents living in neighborhoods dense with nightlife establishments, quality of life concerns relating to noise, sanitation, and lack of retail diversity were major challenges cited. New York Citys nightlife is thriving, outpacing growth in the citywide economy, supporting 299,000 jobs and $35 billion in economic activity, and providing spaces for New Yorkers of all stripes to gather. However, the New Yorkers who rely on nightlife for their livelihood do face challenges, as do residents living in neighborhoods dense with nightlife establishments. The Citys new Office of Nightlife is uniquely positioned to help mitigate these pressures and to ensure that the Citys services and support systems that are available during the day are equally coordinated at night. As the Office of Nightlife sets its policy agenda, it can improve the nightlife ecosystem by working across City agencies to reduce red tape; increase regulatory transparency; address quality of life concerns; and identify opportunities for investment in economic development and cultural retention, through partnerships with both City and non-City entities. These efforts will help not only those who work in New York Citys nightlife, but also the millions of people who venture out, from near and far, to enjoy all the city offers when the sun goes down, as well as those who prefer the comforts of staying in.EXECUTIVE SUMMARY903101642466266Executive SummaryIntroductionEconomic Impact of NYCs NightlifeNYCs Nightlife AssetsNightlife PerspectivesOpportunities for the FutureAppendixCONTENTS10NYCS NIGHTLIFE ECONOMY: IMPACT, ASSETS, AND OPPORTUNITIES10Introduction