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Brain Drain, Bankruptcy & Millions Unemployed: Where Do Concert Workers Go From Here?

On the evening of Aug. 12, a stage was placed in front of the 7,100-capacity Microsoft Theater at LA Live in Los Angeles, where a crowd of no one was given the red-carpet treatment. Forty eight banquet tables sat empty, each with a klieg light, while a sign on a nearby podium spelled out the symbolism behind the setup: each of the arrangements were designed to represent 250,000 live event workers, for a total of 12 million — the estimated number of touring industry professionals in the U.S.

The event, billed as “One Voice: A Day for Action in Los Angeles,” was sponsored by the National Independent Talent Organization (NITO), the Live Events Coalition and California Events Coalition, all of which are calling on Congress to increase aid to live event workers who have been furloughed and laid off during the pandemic. As a succession of speakers — including, most notably, Social Distortion frontman Mike Ness — took the stage, unemployed workers circled the block, honking horns and waving signs in support.

“It was an empty event stage to create what it looks like when large events have no one attending,” says Nadia Prescher, owner of the Colorado-based booking and management agency Madison House who now serves as vp, executive board and founding member of NITO, a nonprofit formed by independent management companies and agencies in the wake of the crisis. “What we’re really seeing is the catastrophic nature [of the pandemic]. We’re seeing other businesses figuring out how to limp along and get by, with 50% open, 70% open. But this business is 100% shuttered.”

Temporary Layoffs Turn Permanent

The rally arrived at a critical time for the live events industry, which has suffered mass layoffs since March when the pandemic resulted in a widespread shutdown of venues and festivals in the U.S. and abroad. Many of those who lost their jobs were full-time workers: In California, New York and Tennessee alone, more than 23,000 employees at concert promotion companies, venues, agencies and more have lost their jobs either permanently or temporarily, according to government filings. Millions more independent contractors are uncounted. Roughly another 1,000 workers were let go last week in a new round of Live Nation layoffs, sources tell Billboard, impacting venues across the country.

As the pandemic drags on — and with the return of large-scale live events in 2020, and even in 2021, looking less and less likely — some of the temporary layoffs have turned into permanent cuts. At the end of May, StubHub announced that of the 450 workers it furloughed at the beginning of the pandemic — roughly two-thirds of its workforce — 200 would be permanently losing their jobs. Lincoln Center in New York suffered a similar blow in June when the organization was forced to permanently terminate 55 of the 200 employees it furloughed in March. Cirque du Soleil, which temporarily laid off 4,679 employees in March — roughly 95% of its global workforce — announced the permanent termination of 3,500 of those workers at the end of June after filing for bankruptcy protection.

That trend is likely to continue as long as Congress’ months-long deadlock on a new coronavirus relief package drags on — a situation that has left live event companies, venues and activists with little recourse but to make increasingly desperate pleas for action. One priority for these groups is getting the Senate-originated RESTART Act — which would set up a system of federally-guaranteed low-rate loans for pandemic-affected small businesses, including music venues — included in any new aid package. An extension of the weekly $600 Federal Pandemic Unemployment Compensation (FPUC) benefit for laid-off workers that expired July 31 is also a primary concern. Without it, workers in the industry have been forced to seek out work in other industries to support themselves and their families during the recession.

Hopes Dwindle for Extension of $600 Federal Benefit

The FPUC program — part of the CARES Act relief package President Donald Trump signed into law on March 27 — was designed as a supplement to traditional state unemployment programs that would maintain the U.S. economy during coronavirus-induced layoffs. When added on top of state benefits, FPUC payments provided laid-off workers with the most generous unemployment program in U.S. history. The CARES Act also extended, for the first time, unemployment aid to freelancers and independent contractors, who would be paid out under a system of state unemployment known as Pandemic Unemployment Assistance (PUA), funded by the federal government.

The CARES Act kept millions of Americans financially afloat during the pandemic, but it had shortcomings. Many unemployed freelance workers with mixed earnings between W2 and 1099 IRS filings fell victim to a flaw in the bill that resulted in reduced benefits. If a worker surpassed a minimum W2 earnings requirement, they were automatically disqualified from receiving PUA benefits — even if they derived the majority of their income from freelance work — with that lesser W2 earnings used as a basis for their unemployment payments. As a result, many came to depend on those now-expired FPUC payments to get by.

According to a Recording Academy snap poll conducted Aug. 6-9, 71.6% of academy members who responded to the survey were receiving the $600 FPUC benefit at the time it expired. With that money now gone, pleas from musician advocates have grown increasingly desperate.

So far, renewing the $600 weekly benefit appears to be a nonstarter for the Mitch McConnell-led Senate Republicans, who have squashed House Democrats’ HEROES Act that would extend the $600 payments through the end of January 2021. They have instead introduced their own aid bills, including, most recently, a $300 billion proposal that would offer a $300 weekly federal unemployment benefit through the end of this year. But that bill died in the Senate on Sept. 10, all but ending hopes for a new relief package before the November election.

On Aug. 8, Trump signed an executive order that provides $400 a week in enhanced unemployment benefits — $300 of which would be covered by the federal government, $100 by the states. But states must opt in and, after experiencing their own sharp drops in revenue due to the pandemic, some may choose not to participate. Legal challenges to the order are also possible, given that Congress, not the President, has control of federal spending under the Constitution. According to Erickson, Trump’s order also excludes people who receive less than $100 per week in state unemployment assistance from qualifying for the $400 boost — effectively preventing many vulnerable individuals who have fallen into the mixed-income trap from receiving the extra aid.

“There’s gonna be a lot of people that don’t know how to pay for food [or] basic expenses,” says Kevin Erickson, director of the Future of Music Coalition, on the human cost of the FPUC expiration. “And the overburdened safety net in charitable support systems are going to be even more overburdened. It’s inexcusable.”

Given the improbability of the $600 benefit being extended, Daryl Friedman, chief advocacy officer at The Recording Academy, is pushing for a resolution to the mixed-income trap that has led to a dependency on the FPUC. To that end, the academy helped craft the Mixed Earner Pandemic Unemployment Assistance Act, unveiled in the House on July 20, which seeks to fix the issue that has kept so many from receiving the aid they need.

Legislative Priorities Stack Up

Unemployment assistance is only the most pressing issue of many that music industry advocates are lobbying for in the next relief package. Among other bills being pushed by The Recording Academy and other allies are the aforementioned RESTART Act, which has picked up 134 cosponsors in the House and 53 in the Senate; the HITS Act in the Senate, which would allow independent artists to fully expense the cost of studio recordings on their taxes in the first year; the Save Our Stages Act in the Senate, which would offer Small Business Administration grants to struggling theaters and other performance spaces; and the ENCORES Act in the House, which would provide tax credits to music venues for refunded tickets. In addition to helping the companies themselves stay in business, many of these bills would also allow them to keep vulnerable workers on their payrolls.

While a piecemeal approach to relief legislation has been proposed by some in the event Congress fails to reach a deal on a broader package, advocates Billboard spoke to for this story are largely skeptical of the feasibility of that approach. “I just don’t see the likelihood of that happening,” says Erickson of the Mixed Earner bill specifically. “I think the path to it getting there would be through the inclusion in a package.”

Unfortunately, the path to getting a broader package through the partisan gridlock on Capitol Hill is far from clear.

“There’s a contingent [in Congress] that doesn’t want this,” says Friedman, who spearheaded the Recording Academy’s most recent District Advocacy Day on Aug. 12. “There are people in the Senate who don’t think they should have another deal.”

An Industry “Brain Drain” Depends on When Concerts Return

Because the live events business isn’t expected to rebound until at least 2021 — and because it is more dependent than most industries on a vaccine or treatment for COVID-19 to resume business — there is a risk of workers who have spent years building their careers in music now being forced to abandon them for jobs in other industries. Traditional state unemployment benefits vary by state, but the weekly amount is generally low. In New York and California — two of the most expensive states in the nation — weekly UI payments top out at $504 and $450, just at and below the national poverty line for a family of four, respectively.

Stormy Shepherd has experienced this phenomenon personally. A veteran independent concert promoter and owner of Leave Home Booking in Utah, after the pandemic hit, Shepherd was forced to furlough a key 15-year employee who went on to secure work elsewhere once the FPUC ran out. She now has a job at a law firm.

“On a personal level, it’s gut-wrenching to lose someone who’s been your right hand for so long,” says Shepherd. “On a business level, it would take me at least a year to train someone to do the job that she’s been doing, at a minimum. It’s devastating that so many of us are losing really good, talented individuals that work for our companies, that work in this industry, because we simply cannot maintain payrolls at full compensation levels right now.”

Still, it is difficult to know when, exactly, large-scale live events will return to the U.S. Estimates have ranged from summer 2021 to sometime in 2022, putting unemployed music workers in a holding pattern with no clear end date.

With the federal unemployment safety net now gone and its reinstatement unlikely, laid-off live event professionals have no choice but to seek out alternative types of work. That could make it difficult to return to their old careers when concerts finally return. “I think if a lot of people decide that they’re gonna have to take another job, it’s gonna be a lot harder for them to want to come back to the industry when it actually is paying salaries and stuff,” says Bobby Garza, an Austin event designer who was furloughed from his job at event producer Forefront Networks in April. He is currently working a part-time contract gig at The Long Center for the Performing Arts in Austin while supporting two young sons.

Garza, who began working for the Long Center in mid-July, considers himself lucky to have been hired right before the $600 federal benefit expired. If not for that, he doesn’t know how he would have gotten by on state unemployment aid alone. In Texas, the maximum unemployment benefit amount is 27% of your salary, he says, “Who in the world can actually afford to live on that?”

Right now, Garza is committed to remaining in live events for the foreseeable future, though he admits he has doubts about his long-term career trajectory in the industry “about once an hour.”

Nineteen-year live events veteran Aryn Bryant has already made the decision to pivot to another field. Bryant tells Billboard she caught the “live event bug” after securing a job at Clear Channel Entertainment in 2001. Due to notoriously long hours and often low pay, she says the industry tends to weed out those who aren’t passionate about the work pretty quickly. Bryant believes it’s that passion that may now be leading many unemployed live event workers to be blinded to the realities of the touring shutdown. “People are so super into it that they’re gonna hang on longer than is good for them,” she says.

Bryant, who went on to work in a variety of marketing roles at Clear Channel, which became Live Nation, and Feld Entertainment, left her most recent job working for the Harlem Globetrotters in February 2019 to get her executive MBA from Tulane University. The plan, she says, was to use the degree to “level up” as a live events marketing executive. Then the coronavirus hit. By the time she graduated last month, she says the industry had been “decimated.” She has now decided to work in brand marketing.

“I can’t go back into live events…. There’s nowhere to go now,” Bryant says. “But even if I wanted to wait it out, the industry is going to have shrunk. Even when they start hiring again, which will happen … there’s gonna be a lot of people fighting for very few jobs for a long time.”

The realities of a COVID-19 vaccine are still unclear and there’s no certainty how concerts will return on a wide-scale when they start to do so. If it’s with capacity restrictions or other safety measures, as some part of the country has begun doing already, profits will be lower and costs will be higher. That means salaries could take a hit too and employers will need to evaluate what value returning or prospective staff members bring to the job. In the interim, Bryant predicts many long-term live events professionals will have left the industry altogether for better-paying, albeit possibly less-fulfilling, jobs, while newcomers may be driven away as well. “You’re gonna have people who are working in a job they’re not ultimately passionate about,” she says, “[and] also the industry is going to lose all this knowledge.”

Serona Elton, an associate professor, director of the music business & entertainment industries program and associate dean of administration at the University of Miami Frost School of Music, isn’t so sure. At this point, she sees little risk of a wide-scale, long-term migration away from the industry.

“For the people that work on the live side, it has to be the case that they, at this stage, are starting to look for other sources of income. And surely they will look outside of the music industry to see what else there is,” says Elton, who has worked in executive roles at EMI and Warner Music Group and previously produced the Miami Music Festival. “But that doesn’t mean that they have left the industry so much as they’re taking sort of a forced hiatus from it.”

She continues, “For something that seems quite temporary in the landscape of your entire career, I don’t think there’s going to be a brain drain that doesn’t come back,” she says. “If you told me, ‘Now it’s five years,’ I’d say OK. Now people start saying, ‘I don’t know about this.’”

Coronavirus

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