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1. DEFINITIONAL AND DATACHALLENGESThere is no question that definitional wran-gling over what counts as creative industrieshas limited its uptake. There is almost exaspera-tion in Simon Roodhouses survey of what he callsthe tortuous and contorted definitional history ofthe arts, cultural and creative industries (Rood-house 2001: 505). There are contending analyticaland statistical categories such as copyright indus-tries, content industries, cultural industries, digital

content, the arts or entertainment industries, andmore. This category confusion means that it isdiffi l h h i i d

timely data about sectors and that it is subject tounfocused analysis and intervention.

A survey of the data challenges faced by thecreative industries notes the extremely difficultstatistical measurement issues to overcome (Pat-tinson Consulting 2003: 6). These issues are partof the broader challenges of measuring effectivelydomains undergoing substantial change throughthe progressive convergence of the computer,communication, cultural and content industries.This is the subject of a growing academic and

policy literature (e.g. Burns Owens Partnership etal. 2006; Pattinson 2003; Pratt 2000, 2004,2008 W i ki 2008) N h b id

Copyright eContent Management Pty Ltd. Innovation: management, policy & practice(2009) 11: 19020

Measuring creative employment:

Implications for innovation policySTUART CUNNINGHAMARC Centre of Excellence for Creative Industries and Innovation, Queensland University ofTechnology, Brisbane QLD, Australia

PETER HIGGSARC Centre of Excellence for Creative Industries and Innovation, Queensland University ofTechnology, Brisbane QLD, Australia

ABSTRACTBoth creative industries and innovation are slippery fish to handle conceptually, to say nothing oftheir relationship. This paper faces, first, the problems of definitions and data that can bedevilclear analysis of the creative industries. It then presents a method of data generation and analysisthat has been developed to address these problems while providing an evidence pathway supportingthe movement in policy thinking from creative output (through industry sectors) to creative inputto the broader economy (through a focus on occupations/activity). Facing the test of policy rele-vance, this work has assisted in moving the ongoing debates about the creative industries toward

innovation thinking by developing the concept of creative occupations as input value. Creativeinputs as enablers arguably has parallels with the way ICTs have been shown to be broad enablersof economic growth. We conclude with two short instantiations of the policy relevance of this con-cept: design as a creative input; and creative human capital and education.

Keywords: creative industries, trident, innovation policy

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tions and industry sectors emerge that do notcomfortably fit into standard statistics classifica-tions. The 1015 year gap between updates ofthese classification schemes means there is almostno comprehensive, standardized employment or

industry data available during the critical emer-gence period of many sectors. Measuring the pro-duction and purchasing of physical products isdifficult enough but measuring the number, sizeand value of the delivery of services is an order ofmagnitude more difficult. The challenges in seek-ing to measure the flow-on impact of emergentdigital creative industries services to other sectorsof the economy are even greater.

Having readily conceded the degree of diffi-culty one faced by all jurisdictions, supra-,inter- and sub-national as well as national itmust also be said that progress is being made onbetter data that is statistically robust and of valuein the development of policy (see Higgs & Cun-ningham 2008). Productive effort has been madeat the intergovernmental level at organizationssuch as the United Nations Educational, Science

& Cultural Organization (UNESCO), the Unit-ed Nations Conference on Trade and Develop-ment (UNCTAD), the Organisation for EconomicCo-operation and Development (OECD), theWorld Intellectual Property Organization(WIPO) and the United Nations DevelopmentProgramme (UNDP). At the national level, therehave been substantial mapping exercises in theUK, Hong Kong, Singapore, Australia, NewZealand, France and in other locations at the

sub-national and local levels. Specific sectors ofthe creative industries have been the focus of con-certed work to map their size and impact on thewider economy (for example, design in Ontario,Victoria, New Zealand and the UK). And at thecutting edge of policy-relevant data analytics,there is progress being made on defining the cre-ative economy, which can be taken to mean thecontribution which the creative workforce and/or

the creative industries sectors themselves aremaking to their national or regional economies(B kh hi M Vi i & Si i 2008 Hi

Cunningham & Bakhshi 2008; Higgs, Cunning-ham & Pagan 2007a,b).

The data challenges faced by policy makersand analysts seeking to grasp the size, growthrates, economic impact and links with the wider

economy of the creative industries are an integralpart of the productive ferment evidenced aseconomies and societies undergo rapid changedue to digitization, convergence, the growth ofknowledge-intensive services and services-basedeconomies more generally. The very difficultiesare themselves an indicator of significance.

2. CASE STUDY: MEASURING CREATIVEEMPLOYMENT

This case study summarises work undertaken forthe National Endowment for Science, Technolo-gy and the Arts (NESTA) in Britain, document-ing a mapping exercise of the UK creativeworkforce using the so-called Creative Tridentmethodology (Higgs et al. 2008). This is part ofNESTAs program of research which is building amethodological and evidence base for the role

that creative industries might play in innovation,and the policy implications of such a link.Other NESTA studies analyse business-to-

business links between the creative industries andfirms in other sectors of the economy (Bakhshi etal. 2008). The importance of soft innovation constant improvement in services, processes,responsiveness, and functional as well as experien-tial design that affects potentially every memberof society comes to prominence (Stoneman

2008). Revealing the hidden innovation inadvertising, independent broadcasting, games andproduct design sees them emerge as particularlyinnovative enterprises, in terms of technologicaland wider innovation (Miles & Green 2008).

The creative industries is the collective termfor those businesses in the economy which focuson creating and exploiting symbolic culturalproducts (such as the arts, films and interactive

games), or on providing business-to-businesssymbolic or information services in areas such as

hi d i i d k i d

Measuring creative employment: Implications for innovation policy

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design, as well as web, multimedia and softwaredevelopment. In a practical sense the creativeindustries are defined by a selection of StandardIndustry Codes (SIC) that are implemented innational datasets that encompass the specialist

businesses that produce creative goods or services.As we have argued, policy understandings of the

creative industries have been hampered by the lackof a consistent definition of creative activity. Thenumber of occupation groups has grown as theprofessions themselves have evolved. We identify20 in the 1981 and 1991 household censuses inthe UK but 26 in the 2001 census which include:town planners and graphic designers; advertising

managers and furniture makers; actors and librari-ans; journalists; software professionals; architectsand archivists. But of no small significance arethose working in creative occupations who do notwork in the creative industries. There are more cre-ative jobs outside the creative industries than cre-atives working in the creative industries.

Originally developed in 2005 for applicationto Australian data, the Creative Trident method-

ology differs from previous attempts to measurecreative activities in three key respects: it usespopulation data (the number of people employedin each occupation within every industry) to pro-vide more accurate estimates; it employs a conser-vative approach to the selection of creativeoccupations and industries, to avoid overreachand enable better comparability between the seg-ments and to the economy as a whole; and itallows, for the first time, estimation of creative

incomes. The purpose of the mapping was not toreplicate the official DCMS definition but ratheran exploratory exercise to apply a critical out-siders eye to the available UK employment data.

The Creative TridentIn comparison to Australian and New Zealandcensus collections, UK census data are problemat-ic in terms of timeliness, the level of detail in

industry classifications, and the exclusion of earn-ings data. We employ the Creative Tridentmethodology to a combination of UK census andLabour Force Survey data1 by applying a defini-tion, comprising selected occupations and indus-

tries, to analyse detailed data. This contains countsof the number of people employed, and wherepossible their mean income, in every occupationacross every industry. The methodology constructsaggregate counts of individuals employed in spe-cialist, supportand embeddedmodes and providesdetailed counts according to the level of occupa-tional and industry detail available.

Definitions of the three modes analysed are:

1. Specialist mode: Those people in defined cre-ative occupations employed within thedefined creative industries;

2. Support mode: Those people employed withinthe defined creative industries who are notworking in the defined creative occupationsbut perform the essential sales, management,secretarial, accounting and administrativefunctions;

3. Embedded mode: Those people employedwithin the defined creative occupations whoare working outside the defined creativeindustries.

The Creative Trident methodology can beapplied using any well-articulated definition ofactivities (for example, cultural, creative or evenfinancial services). However, it works best whenthere is a concentration on what we call the pre-

creation and creation stages of the value chain,which we refer to collectively as the creativecore. Concentrating on these stages means thatwe capture the essential starting points for cre-ative activity, whether in the creative industriesthemselves (i.e. the specialist mode) or in thewider economy (the embedded mode).

While this is a different approach to that of theDCMS Economic Estimates, it employs a selec-

Stuart Cunningham and Peter Higgs

1 Office of National Statistics, UK Census 2001 http://www.statistics.gov.uk/census2001/product_definitions.asp and theUK Annual Population. Survey based on the LFS 2001 to 2006.h // k/STAT AS / d l k

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tion strategy very similar to Layer One of the five-layer generic supply chain concept proposed byFrontier Economics (2007a). Frontier Economicssuggests that the level of creativity declines fromLayer One to Layer Five, and that Layer One is

the most appropriate to use for most benchmark-ing purposes. Our definition of the creative core(corresponding closely with that employed byFrontier Economics 2007b) selects the activities,in either occupation or industry classifications,which occur at the pre-creation stage (includingpreservation, access, collecting and licensing activ-ities), and the creation stage of the value chain. Inthe creation stage, we follow Throsbys (2001)

notion of creative workers, defined as those: engaged in producing primary creative outputfor example, writers, musicians, visual artists,film, television and video makers, sculptorsand craftspeople;

engaged in interpretive activity for example,performers interpreting works of drama,dance, music etc. in a wide variety of mediafrom live performance to digital transmission

via the Internet; and, supplying creative services in support of artisticand cultural production for example, book edi-tors, lighting designers, music producers, etc.

While Throsbys definition is essentiallyoccu-pation-focused, deriving as it does from culturalemployment, it may also be applied to industry-defined activities and services.

Our core definition ofcreative industries, we

believe, establishes a justifiable demarcationbetween specialist and embedded employment,while our core definition of creative occupationsmakes the measurement of embedded employ-ment more robust. The effects of this morerestrictive selection on total employment data aremitigated by the fact that the methodology, rely-ing as it does on two-dimensional occupationwithin industry employment datasets, still counts

the employment of those in creative occupations,regardless of whether or not they work in the cre-

i i d i d fi d

The Creative Trident represents an advance onprevious creative industries mapping approachesbecause it: avoids the tendency to overreach; dis-aggregates creative employment effectively andwith resulting insight; allows for the decomposi-

tion of specialist and support employment withincreative industries; and uses population-based datasources rather than surveys, whenever possible.

Applying the Creative Trident toUK dataThere are limitations in the available UK datawhich constrain the robustness of quantitativeanalyses of creative employment, including the

Creative Trident. No single dataset reliably pro-vides the basic information required and there islimited coverage of the self-employed. Addition-ally, census data is only collected at ten-year inter-vals; there is low resolution of classifications,especially by industry; and the UK censusexcludes individual incomes. This contrasts withcensus methodologies in, for example, the US,Australia and New Zealand.

The major limitations of the Labour Force Sur-vey (LFS) for our purposes are that: it constrainsmulti-dimensional analysis mainly to sub-totalsexcept for very high employment occupation-industry combinations; there is recently improvedbut still low resolution of classifications, especiallyby industry; there is no income data available forthe self-employed; and there are inconsistenciesbetween the census employment data at detailedlevels.

ResultsThis is a summary of results for the UK employ-ment trident, incorporating specialist, supportand embedded creative employment for 1981,1991 and 2001; growth rates in creative employ-ment; the Creative Income Trident (the levels ofcreative earnings for specialist, support andembedded creative workers from 20012006)

and growth in creative employment and earningsis compared with economy-wide averages for the

l i d


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UK Creative Employment Tridents:1981, 1991, 2001 and 2006Table 1 shows that at the time of the 1981 house-hold census there were approximately 900,000people in creative employment, representing

3.9% of the workforce. Of these, almost halfwere employed in specialist businesses working inthe creative industries. Those working in special-ist creative occupations represented only 35% ofthe employment in creative industries. Theremaining people in creative employment thoseworking outside the creative industries repre-sent 74% of those in creative occupations. How-ever, it is quite likely that a significant degree of

this embedded employment is due to the limitedability of the industry classifications used over theperiod to capture many of the newer specialistcreative business activities.

By 1991 the number of people in creativeemployment had risen to over 1.1 million.Growth in the number of specialist creative occu-pations in the creative industries appears to havebeen particularly marked and this growth cannot

be discounted as classification artefact as thesehardly changed over the period.Creative employment increased substantially

between 1991 and 2001, rising to almost 1.9 mil-lion people, or 7.1% of the UKs workforce.

Employment within the creative industriesamounted to 1.2 million people, representing66% of total creative employment. Again, growthappears to have been particularly rapid in thenumber of specialists employed in the creative

industries, but this time in the number of sup-port workers too.

Over the twenty-year period between the 1981census and the 2001 census, creative employmentin the UK experienced a cumulative annualgrowth rate (CAGR) of 3.8%. This is substantial-ly higher than the overall growth in UK employ-ment of 0.8% (Table 1). Between these twocensuses, specialist employment, that is, those in

creative occupations working within the creativeindustries, experienced the highest growth rate ofall categories, at 6.5%.

Over a twenty-five-year period the averageannual growth rate of creative employmentremains significantly higher at 3.2% than that ofthe total workforce at 0.8%. Creative employmenthas grown significantly over the 25 years coveredin this study to 7.9% of the workforce, led by the

substantial growth in creative specialists. There islower growth in embedded employment but stillat a rate (1.7% per annum on average) that istwice that of the workforce. A significant propor-tion of the difference between specialist and


TABLE 1: THE LEVEL OF SPECIAL IST, SUPPORT AND EMBEDDED CREATIVE EMPLOYMENT AND THE UKWORKFORCE 1981, 1991, 2001 USING CENSUS DATA, AND 2006 USING LFS DATACensus data 20 year ave LFS 5 year aveEmployment 1981 1991 2001 growth 2006 growth

Specialist 157,020 285,460 552,170 6.5% 699,931 4.9%

Support 288,850 313,440 690,641 4.5% 585,111 -3.3%

Subtotal Creative Industries 445,870 598,900 1,242,811 5.3% 1,285,042 0.7%

Embedded 457,130 524,750 645,067 1.7% 698,244 1.6%

Subtotal Creative Occupations 614,150 810,210 1,197,237 3.4% 1,398,175 3.2%

Creative Employment 903,000 1,123,650 1,887,878 3.8% 1,983,286 1.0%

UK workforce 22,866,100 23,452,230 26,575,775 0.8% 28,165,612 1.2%

Embedded share ofCreative Employment 51% 47% 34% 35%

Creative EmploymentShare of UK Workforce 3.9% 4.8% 7.1% 7.0%

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embedded growth rates may be due to the outdat-ed industry classifications that were used in the1981 and 1991 census periods. This had the effectof reducing the specialist employment level(157,020 in 1981) and inflating the embedded

level (457,000 in 1981) for those periods.

Creative Income and EarningsTridentsThe earnings of people employed in creativeoccupations and the creative industries can bedetermined by utilising the mean weekly incomedata specific to each combination of occupationwithin industry, as provided by the LFS survey

on the basis of main job, and combining thiswith estimates of employment from the CreativeEmployment Trident. (Unfortunately the LFSdoes not collect personal income data for the self-employed, so this had to be estimated.) Theresultant tables of earnings are very useful forcomparing the contribution of particular creativesegments, to other segments, to other sectors ofthe economy or to the economy as a whole. It is

worth noting that the earnings from creativeemployment from our calculations have risen toalmost 10% of the UK total workforce earningsin 2006 much higher than the 7% share creativeemployment has of the total workforce. By wayof comparison the DCMS Economic Estimatesreport shows the Creative Economys share of UKGross Value Add ranges from 7.7% in 2003 to7.4% in 2004.

The earnings data can also be used to deter-

mine the mean annual income of those in cre-ative employment, within the various segmentsand as a whole. For instance the mean annualincome in the UK in 2006, determined by datafrom the LFS for those in creative employment,was 28,770. This compares favourably with themean for the UK workforce of 21,060.

Tracing the extent of embeddedemployed on the broader economyTable 1 showed that almost 700,000 people were

l d i h UK i 2006 i i

tions outside the industries traditionally classifiedas creative and that this employment is consis-tently growing at around 1.6% to 1.7% perannum, significantly higher than the generalworkforce. The detailed two-dimensional datasets

used to calculate the Creative Trident allow addi-tional types of analysis which are not possibleusing single-dimension, occupation-based orindustry-based employment datasets so it is par-ticularly interesting to examine the distributionof embedded employment across the whole econ-omy, either at the single-digit division level oreven at the more detailed two-digit industry level.

Between 1981 and 2001 there was a substan-

tial rise in the level of embedded employmentacross nearly all sectors of the economy (seeTable 2). The largest increase in the share was inDivision J (Financial intermediation), up from1.6 per cent in 1981 to 4.6 per cent in 2001, fol-lowed by Division I (Transport, storage andcommunication), where the embedded propor-tion increased from 0.6 per cent to 2.4 per cent.Only three divisions (K, N and O) showed a

decline in the share of embedded creativeemployment over the period; the most signifi-cant of these was the fall from 6.1 per cent to 4.5per cent in Division K.

The right-hand side of Table 2 also shows thatfor the shorter period 2001 to 2006 and usingLFS data, there was no appreciable change in theshares embedded creatives have of Divisionemployment, except in Division L (Publicadministration), where the figure increased from

2.3 per cent to 3 per cent, and Division K, inwhich it appeared to rise slightly over the courseof the five years. (Similar changes over the past 20years in Division employment are also seen inAustralian and New Zealand Creative Tridents(Higgs & Cunningham 2008).)

Embedded employment analysis, useful as it isfor revealing gross patterns in the relative demandfor creative skills across the economy, immediate-

ly raises the question: what are creatives actuallydoing, and why, in these sectors? With JanetP (P l 2008 2009) di d h


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contribution of creative expertise and services toAustralian healthcare. This work combined analy-sis of embedded employment for each of six cre-ative segments with a series of 12 cases studies.

The case studies found that creatives are mak-ing a range of contributions to the developmentand delivery of healthcare goods and services, the

initial training and ongoing professionalism ofdoctors and nurses and the effective functioningof healthcare buildings. Creative activities withinhealthcare services are also undertaken by medicalprofessionals and patients. Key functions that cre-ative activities address are innovation and servicedelivery in information management and analysisand making complex information comprehensi-ble or more useful, assisting communication and

reducing psycho-social and distance-mediatedbarriers, and improving the efficiency and effec-i f i

3. CREATIVE INDUSTRIES ARTICULATEDINTO INNOVATION POLICYThis research supports a focus shift in policyterms from an emphasis on creative outputs(the creative industries as a specific sector) tocreative occupations as inputs into the wholeeconomy, and creative outputs as intermediate

inputs into other sectors. This idea of creativityas an economic enabler arguably has parallelswith the way ICTs were shown to be broadenablers of economic growth in the past. Thismay facilitate a stronger focus on innovationsystems which support the development of thecreative economy.

In recognising a connection between creativeactivities across many industry sectors and the

innovation process, policy might focus onenhancing the input value of creative activities inh f i d d l d i


TABLE 2: CHANGES IN THE DISTRIBUTION OF EMBEDDED EMPLOYMENT ACROSS THE DIVISIONS OF THE UKECONOMY IN 1981, 1991, 2001 AND 2006Embedded Creatives share of Divisions employment

Census data LFS dataDivision of the UK Economy 1981 1991 2001 2001 2006A Agriculture, hunting and forestry 0.1% 0.1% 0.9% 0.3% 0.6%

B Fishing 0.3% 0.2% 0.6% 0.0% 0.0%

C Mining and quarrying 0.9% 2.3% 2.6% 2.3% 2.3%

D Manufacturing 3.1% 4.3% 5.3% 4.7% 4.7%

E Electricity, gas and water supply 2.3% 3.4% 4.0% 3.4% 3.2%

F Construction 0.8% 0.8% 1.4% 1.9% 1.5%

G Wholesale and retail trade etc. 1.1% 1.2% 1.6% 1.5% 1.7%

H Hotels and restaurants 0.2% 0.3% 0.7% 0.4% 0.5%

I Transport, storage and communication 0.6% 1.1% 2.6% 2.7% 2.2%

J Financial intermediation 1.6% 2.7% 4.7% 5.4% 5.1%K Real estate, renting and business activities 6.1% 7.0% 4.6% 4.1% 4.4%

L Public administration and defence 0.6% 0.7% 2.3% 2.3% 3.0%

M Education 1.3% 1.4% 2.1% 1.9% 1.8%

N Health and social work 1.8% 1.5% 1.0% 0.7% 0.8%

O Other community etc. service activities 2.7% 3.1% 2.3% 1.1% 1.3%

P Private households 0.1% 0.0% 0.4% 0.2% 0.1%

Q Extra-territorial organisation and bodies 3.3% 4.3% 4.3% 4.1% 4.5%

Not Specified 0.4% 0.9%

Total of all divisions 2.1% 2.6% 2.7% 2.5% 2.5%

Source: Analysis by CCI of custom Census and LFS tables from the Office for National Statistics

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tion strategies. An indicative range of relevantpolicy areas might include: R&D (including tax concession) policies being

reviewed to recognise the role of creativeinputs into industry innovation.

Facilitating links between creative industryservices and the wider economy (perhapsthrough vehicles such as innovation vouchersystems).

Promote the career opportunities available forcreatives in the wider economy, based on thenotion that creative individuals have great flex-ibility, found as they are across a wide cross-section of the economy at large.

Promoting the attractiveness of careers in thecreative industries, based on the data thatshow higher than UK average incomes for allbut a few sectors.

Our findings regarding the embedding of cre-ative activities across the economy, raise the possi-bility that cross-industry linkages and technologytransfer due to creative workers, mean that the

creative sector may be significantly more involvedin the innovation system of national and regionaleconomies than has been recognised before. Thismay have important implications for innovationpolicy which has traditionally been exclusivelyassociated with the science- and technology-basedindustries.

We conclude with two short instantiations ofthese proposals which flesh out their implicationsfor innovation policy.

Design as creative inputThe notion of creativity as an input to other sec-tors of the economy has begun to be rigorouslytested. Design is recognised as a fundamentalinput into most products and services in theexperience economy. Sources such as the WorldEconomic Forums Global CompetitivenessReport and the UK Design Council have demon-

strated that there is a distinct correlation betweendesign-intensity in enterprise activity and productdevelopment, and broad economic competitive-ness at the firm and national level. Additionally,design activity is notoriously underestimated in

official national statistics and employed designersare so broadly embedded throughout industrysectors that their contributions are significantlyundercounted.

There is now some good evidence from thefour years of the Better by Design program inNew Zealand of the results of their ambitiousgoals of improving expert performance throughdesign as a crucial value-add to manufacturing,

tourism and other export-facing industries.2 Bet-ter by Design was established in 2004 to increaseNew Zealands export earnings by assisting com-panies to grow in international markets andimprove their financial performance by the strate-gic use of design. To achieve this, Better byDesign offers a range of services to assist business-es integrate design into all aspects of their opera-tions. The primary objective to drive this mission

is 5

50

500

5: In the first 5 years, atleast 50 existing businesses made internationallycompetitive through design leadership, generat-ing an additional $500m per year in export earn-ings, growing at 5-times targeted GDP toproduce $1.5b by year 10. An audit conductedin 2008 found that the fifty highest performingcompanies are 3.5% ahead of reaching the tar-geted goal of an extra $500m in export revenuein five years, and seeing exports grow at 4.5

times GDP.With an integrated set of interventions on the

demand side (in manufacturing and among serv-ices firms), companies using design inputs aredisplaying a higher level of understanding of cus-tomers and their need and desires, an increasedawareness of the role of design in strategic andoperational processes, and product and servicechanges, including improved look and feel partic-


2 See www.betterbydesign.org.nz. The data on implementation was supplied by Judith Thompson, Director, Better by( Z l d T d d ) b

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ularly for products from engineering type organi-sations. There were observable improvementsincluding more integrated product development,branding, increased investment in design andproportion of turnover from exports and overall

turnover growth.Kretzschzmars (2003) Danish study highlights

the importance for policy makers of the distinc-tion between specialist and embedded designersand the linkages between them. The study char-acterised manufacturers into 4 types: those withno design investment; those with an embeddedor internal design department; those who utiliseexternally purchased design services (specialists);

and those with both an internal design depart-ment and who also purchase external specialistservices. The latter group are shown as having arate of increase in exports that is twice that of theother three groups. They also had an averageannual growth in their gross revenue 22 per centabove the average for Danish companies.

The implication is that while buying externalor building internal design expertise is worth-

while, the best results come from firms that doboth well. But most government industry devel-opment programs focus on the specialist firms, inthis case design consultancies, while ignoring theinternal departments and missing the need for acompany, where possible, to have internal designcapacity interacting with specialist design consul-tancies.

The Trident employment methodology canhelp measure the changes in these ratios at the

national and regional level for most subsegmentswhile other methodologies such as enterprise sur-veys would be required to determine the levelswithin individual firms.

Human capital and educationThe notion of the creative economy argued for inthis paper suggests a human capital model, ratherthan an exceptional sector model, for the impor-

tance of creativity in the economy. The theme ofhuman capital in a creative economy allows for

h di i li i i h

the distinctive value of each for innovation, mov-ing away from assumed science-based priorities.It also goes to the centre of fifth generationinnovation thinking, where it is dynamic linkagesfacilitated by personnel transfer or talent mobility

that ensure the flow between stock in the sys-tem. It is the domain where government is onsurest ground in defining its role in innovation,through education and training and its deriva-tives. It is also critical for the way in which itaddresses both the supply side and demand sideof innovation.

There are quite radical implications for formaleducation here. Education must engender a bet-

ter rapprochement across the arts and science sec-tors in research and curriculum. It is critical todelay hyper-specialisation in the upper years ofsecondary school and lower years of undergradu-ate education, not simply by enforcing a broadrange of subject choice but also the creation ofsome space for problem-based cross disciplinaryapproaches is important. At the postgraduate andresearch training end, the capacity to bring spe-

cialisations together in dynamic multidisciplinaryformation is equally critical, reconnecting the dif-ferent knowledge modes.

This is not a matter of dissolving disciplinaryspecificity into a melange of fashionable themesand problems (although at the cutting edge ofknowledge we expect to find multiple emergentnew disciplines), but a pedagogical and researchfunding focus encouraging and enabling multi-disciplinary teams to work effectively on the big

issues facing us. It is about coordination betweendisciplines rather than necessarily a subsumptionof disciplines. Collaboration recognises that manyif not most of the countries most important pri-orities require multiple disciplinary inputs due totheir complexity and scale.

Human capital development through educa-tion is not only about the supply of expertise intothe workforce; it is also about the demand for

innovation. The demand side goes to the ques-tion of absorptive capacity: critically trained,

i ll hi i d h


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nect their buying habits with their identity as citi-zens, who play a critical role in demandinginnovation and can cope with, respond to, andabsorb innovation. They can appropriate andadapt technologies and new knowledge to their

own ends in sometimes surprising, unintendedand innovative ways.

While it is true that arts and humanitiesexpertise play a well recognised role in slowingdown scientific progress insisting on and pro-viding the ethical and other holistic approachesto the social implications and applications ofknowledge (e.g. the ethics of Stem Cell Research,biotechnology, GM foods), they can also speed

up social absorption of innovation by under-standing breaking trends, interpreting difficultand complex challenges to belief, custom andpractice, giving us the insights and frameworks tounderstand and absorb change. Design and fash-ion, for example, speed up the absorptive capaci-ty of the consumption base of society, speaking tothe demand side as much as the supply side ofinnovation.

4. CONCLUDING COMMENTThis paper offers an evidence base contributingto the concept of a creative economy and itspotential links to innovation. We argue that poli-cymakers should move beyond sector-specific,output-oriented, approaches. Stronger cross-industry linkages (for example, through designservices) and knowledge transfer through embed-ded creatives mean that the creative industries are

potentially more involved in the innovation sys-tems than has previously been recognised.

The influence of this focus on linking creativeindustries and innovation is evident in the UKWhite Papers, Creative Britain: New Talents for theNew Economy(DCMS 2008) and in InnovationNation (DIUS 2008). Creative Britain speaks ofthe need for the creative industries to move fromthe margins to the mainstream of economic and

policy thinking, as we look to create the jobs ofthe future. Creative human capital developmenti bl h l h f h

extending to large scale apprenticeship schemes tocoordinate better human capital inputs into thevolatile and slippery creative economy. There arepolicies for business development pathways forcreative entrepreneurship, including a voucher

scheme designed to promote better coordinationbetween demand and supply; and recognitionthat research and development must underpin themainstreaming of the creative economy.

There are by now a set of policy frameworks,decent evidence and enough practical programimplementations to suggest that the link betweencreative industries and innovation policy can sur-vive robust scrutiny. The logic driving the move

from creative industries to creative economy isthat the creative industries are not significantonly in terms of producing a particular set ofproducts and services, but also because they areengaged in the provision of coordination servicesthat relate to the origination, adoption and reten-tion of new technologies, commodities or ideasinto the economic system. They provide, in otherwords, innovation services.

The research and evidence provided in thispaper seeks to prepare an evidence base for suchan argument.

ACKNOWLEDGEMENTThanks to Dr Harvey May for research and edi-torial assistance.

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