The American Alliance of Museums (AAM) warns that one out of every three museums may shutter forever as funding sources and financial reserves run dry. Without near-term assistance from governments and private donors, hundreds of directors reported their museums may not survive the financial crisis brought on by the pandemic.
The new survey of more than 750 museum directors, fielded throughout June, confirmed early estimates of the dire economic harm to museums caused by the COVID-19 closures, which are expected to continue due to recent outbreaks across the country. Museum directors responded to the AAM survey on behalf of their organizations, representing a broad cross-section of the field geographically, by size, and by discipline.
“Museum revenue disappeared overnight when the pandemic closed all cultural institutions, and sadly, many will never recover,” said Laura Lott, President & CEO of AAM. “Even with a partial reopening in the coming months, costs will outweigh revenue and there is no financial safety net for many museums. The distress museums are facing will not happen in isolation. The permanent closure of 12,000 museums will be devastating for communities, economies, education systems, and our cultural history.”
Museums are not only stewards and interpreters of our culture, they are vital sources of employment and economic engines. Museums support 726,000 direct and indirect jobs and contribute $50 billion each year to the economy. Of the museums able to reopen, over 40% plan to do so with reduced staff and will need to spend additional funds to ensure their ability to reopen safely.
The new research was conducted by New Hampshire-based Dynamic Benchmarking at no charge to the museum field. “This data is critical as the Alliance continues to advocate for the resources museums require to recover from the current financial crisis,“ Lott said. Alliance advocates secured hundreds of millions of dollars for museums, and the Federal Paycheck Protection Program has served as a lifeline for many museums. “However, with the funding running out, furloughs and layoffs will grow without additional financial support from the government or donors.”
Other findings in the new AAM/Dynamic Benchmarking survey show how museums will struggle to recover, even when institutions are able to reopen to their communities.
**One-third (33%) of museum directors surveyed confirmed there was a “significant risk” of closing permanently by next fall, or they “didn’t know” if they would survive.
**The vast majority (87%) of museums have only 12 months or less of financial operating reserves remaining, with 56% having less than six months left to cover operations.
**During the pandemic, 75% of museums stepped into their pivotal role as educators providing virtual educational programs, experiences, and curricula to students, parents, and teachers.
**Two-thirds (64%) of directors predicted cuts in education, programming, or other public services due to significant budget cuts.
Museums across the country are working to win new funding from federal, state, and local governments this year to help with the crisis. “On average, museums receive less than 25% of their total funding from government sources,” Lott explained. “Money from public and private sources is crucial to saving the museum field.”