Focus on regional development
Fifth Austrian Creative Industries Report
The creative industries are primarily located in and around state capitals, but creative businesses in rural areas are growing stronglyÂ
With regard to the location, it can be seen that after Vienna (42 %), most companies of the creative industries are located in Lower Austria. 15 % of all domestic creative industries enterprises (i.e. about 5,600 enterprises) were located in this province in 2010. About 10 % of the creative industries enterprises were located in Upper Austria (about 3,900 enterprises) and in Styria (about 3,800 enterprises).
After Vienna (17.5 %), the creative industries - measured in terms of all enterprises - have the greatest significance in Lower Austria, where about 9 % of all enterprises located there were attributable to the creative industries in 2010. High shares were also found in Salzburg, Styria and Vorarlberg, where the share of creative industries enterprises amounted to about 8 % of all enterprises in each case.
On the whole, creative industries companies are primarily located in the provincial capitals and around the urban centres, in the so-called "rurban" sprawl. In the provincial capitals and some districts around Vienna, the share of creative enterprises was more than 10 %. Above-average shares (7.4 % to 9.9 %) were also found in the suburbs around Linz, Graz and Salzburg as well as in the Vorarlberg districts of Bregenz, Dornbirn and Feldkirch. Creative industries are an urban and rurban phenomenon. Approximately 18 % of creative industries enterprises are also found in rural areas.
With regard to the development dynamics in the regional area, it can be observed that the dynamics of creative industries enterprises in rural regions - starting from a lower level - is higher than in urban areas. In municipalities with a low population density, their number in Austria increased by more than 10% between 2008 and 2010, which is significantly higher than in municipalities with a medium (approx. +8%) and high population density (excluding Vienna: approx. +6%).
Thus, the growth of the creative industries reflects the ongoing structural change towards the service sector also in rural areas and reveals regional potentials for the creative industries.
Work-life balance is an important factor in the choice of location
For creative professionals, the boundaries between private and professional spheres of life and contacts are often blurred. Creative entrepreneurs based in the city in particular exhibit a high degree of interweaving of private and professional networks. This softening of the differentiation between work and life is also reflected in the factors that creative companies demand of their business location.
The analyses show that creative companies take the work-life balance, i.e. the compatibility of work and private life, into account when choosing a location. Those entrepreneurs who choose a location solely for business reasons are in the minority. The choice of location by creative entrepreneurs tends to be made spontaneously. The most important private reasons include the proximity to the place of residence and the quality of life. Inexpensive premises, infrastructure and sales market are the most important entrepreneurial reasons for choosing a business location.
Overall, the creative industries are highly satisfied with a large number of soft and hard location factors. Thus, Austria's good location quality for the creative industries can be noted. The quality of life was identified as the factor that creative professionals most frequently rate as important for entrepreneurial success. At the same time, it is also the factor with which creative entrepreneurs are most satisfied. In addition, the "creative milieu" plays an important role: for six out of ten creative enterprises, a tolerant, open environment or the presence of creative like-minded people is important for business success.
Regional anchoring and fixed company locations are a given, but spatial mobility is also a given.
More than half of the surveyed creative industries enterprises work in their own offices, more than one third from home, and about 5 % work in incubators or shared offices. City-based entrepreneurs are more likely to have flexible workspaces: Less than 5 % of the enterprises stated that they do not have a fixed place of work, whereby the share of entrepreneurs with flexible places of work or no fixed place of work is more pronounced in urban regions than among creatives in rural regions (approx. 5 % compared to approx. 2 %).
More than half of the entrepreneurs could carry out their entrepreneurial activity independent of location, i.e. independent of the company location. However, only a smaller proportion (about 14 %) of the creative professionals work predominantly in places other than the company location. The fact that the most important customers and cooperation partners of the creatives are mostly located in the same region as their company location indicates that the creative entrepreneurs could work location-independently from their working conditions, but are ultimately very locally anchored. This is also reflected in their understanding of the region: Around 66 % of the creative industries companies have a small-scale understanding of the region, which usually only includes the immediate surroundings (neighbourhood, municipality, city).
The high proportion of creatives who can work independently of location shows that the industry is flexible in terms of the spatial infrastructure of its working conditions and that there is a willingness to accept new working spaces if these meet private and professional location requirements. Quite a few creative professionals (approx. 17 %) are planning a change of location in the next three years, especially those companies that are in a growth phase.
Four regional types of companies in the creative industries with different requirements for their location
The diverse sectors of the creative industries, with their different structures, also have different requirement profiles for the business location. An additional diversity results from specific spatial interaction. Within the framework of this study, four different types of creative industries enterprises could be identified according to spatial criteria. By means of a statistical procedure for group formation (cluster analysis), the enterprises in the sample were assigned to the following types: "rural creative" (28%), "cross-border creative" (17%), "city-dependent creative" (24%) and "intrinsically motivated urban creative" (31%).
The "intrinsically motivated urban creatives" are located in urban areas and are also networked there. They are characterised by spatial flexibility, which means that they can also pursue their entrepreneurial activity in other places. Their presence in the city is not absolutely necessary for their entrepreneurial activities and is therefore motivated by other reasons. For the most part, this type of enterprise does not employ any staff (80% EPU). Locating in the city is therefore a conscious decision.
The "rural creatives" are located outside of urban regions. The most important customers and business partners of this type of enterprise are also located outside cities. The "rural creative entrepreneurs" mostly run small enterprises, 60 % are one-person enterprises (EPU).
The "city-dependent creative enterprises" are based in the city and have their most important customers or business partners in urban areas. Their entrepreneurial activity requires, in particular, a presence at the location. More than 40 % of this type of company employs five or more people.
The "cross-border creative enterprises" can be found in urban as well as in rural regions, and the most important customers or business partners are located abroad. The "cross-border creative entrepreneurs" are on average larger than the "rural" and "intrinsically motivated urban creative entrepreneurs": 40 % belong to the group of EPUs, about 15 % have ten or more employees.
The different types of companies place different demands on the location conditions: The "city-dependent" and the "cross-border creative enterprises" more often rate research and development infrastructure as well as the labour market as determining factors for success. For the "urban" region types, the availability of real estate or adequate premises is of high importance. The public transport network is another important location factor for these types. The "rural" companies more frequently rate regional ties as a central factor for the company's success.
The majority of creative entrepreneurs are also satisfied with the location factors that are important to them. The "rural" and "cross-border creative entrepreneurs" tend to be somewhat less satisfied with the spatial proximity to networks and cooperation partners as well as to creative peers. Compared to the other types of enterprises, the types of enterprises located in the countryside also rate the transport connections and the public transport network somewhat worse. The "cross-border creative entrepreneurs" show lower satisfaction scores with the research and development facilities located at the site. Since the search for adequate real estate is a challenge, especially for companies located in the city, the satisfaction with price and availability of premises is lower overall for the urban types.
Creative industries create potential for economic development in the region
In recent years, it has been recognised that the creative industries can make an important contribution to the economic revitalisation and repositioning of cities and regions. The European Commission sees the cultural and creative industries in a strategically favourable position to promote smart, sustainable and inclusive growth in EU regions and cities and values their contribution to the Europe 2020 strategy, the EU growth strategy for the next decade, as significant. As a result, the European Commission calls on the member states to include the promotion of the creative industries in their regional development plans and, in particular, to use the resources of the EU Structural Funds for this purpose (cf. European Commission 2012b).
As already emerged from the analyses of the Third and Fourth Austrian Creative Industries Reports (cf. creativ wirtschaft austria 2010 and 2008, respectively), creative enterprises are highly innovative and at the same time innovation-driving for companies and organisations from other sectors. The creative industries increase the competitiveness of other economic sectors, for example, by making products and services more attractive, promoting their marketing, improving business processes and commercialising innovations on the market. The supply of creative services thus also increases the attractiveness and competitiveness of a location.
Although the creative industries should not be understood as a panacea for every structurally weak region, there are enough examples where the integration of the creative industries into sustainable regional development plans supports the growth and revitalisation of a region's economy. Some suggestions are given in this study based on case studies. With an appropriate intelligent positioning, the creative industries can also strengthen the USP ("Unique Selling Proposition") of a region or help to bring about a possibly desired image change. Furthermore, the creative industries offer attractive jobs and the possibility of self-employment, thus opening up interesting perspectives for the next generation and highly qualified people, which can help to counteract emigration and brain drain. Last but not least, the creative industries can contribute to overcoming crises and structural change in a regional context through their above-average performance.
Top-down and bottom-up strategies to promote the creative industries in the regions
The national and international case studies show that there are different strategies for promoting the creative industries, especially in rural regions. Initiatives are highlighted in which the impulse was set "top-down", i.e. "from above", institutionally or politically. These include the impulse centre "Campus Dornbirn" in the Vorarlberg Rhine Valley, which links small and micro enterprises in the creative industries with major clients from the business world, or a regional funding programme implemented in the Swedish region of Gävleborg, which integrates the promotion of the creative industries into existing structures.
Conversely, examples are also shown where the impetus came from the "grassroots" (the creative entrepreneurs themselves): OTELO Offenes Technologielabor offers low-threshold experimental spaces for technology, media and design in the wider Linz area. The English creative network CIN, which was also analysed in more detail, represents a "one-stop shop" for urban and rural creative enterprises in the Derbyshire region.
So-called "lighthouse companies" can generate charisma in the region and provide impulses in the direction of the creative industries, as demonstrated by the example of the window, door and furniture manufacturer KAPO in the Oststeirisches Kernland and the automotive company Ficosa in the Spanish region of Catalonia.
The case studies make it clear that there is no one recipe for success that is valid for all regions, but that different strategies can lead to success in a specific situation and with different regional conditions. Furthermore, it becomes clear that especially in a rural area beyond the urban centres, a (political) will and concrete measures by the respective actors are necessary in order to achieve noticeable effects for a region with the creative industries.
In Austria, an effective and holistic instrument for the promotion of the creative industries has already been created at the federal level with evolve, the innovation promotion programme for the creative industries 2008 - 2013. Developed by the Federal Ministry of Economy, Family and Youth (BMWFJ) and implemented together with austria wirtschaftsservice GmbH (aws) with the programme line "impulse/aws" and creativ wirtschaft austria in the Austrian Federal Economic Chamber, the funding programme aims at monetary support, service and awareness raising.
At the level of the federal states, numerous structures and measures have also been created in recent years to strengthen the creative industries on the supply and demand side in a small-scale and effective manner.
(Political) will and awareness for creative industries strengthens creatives
The following factors are central to the development of the creative industries in the regions: Strengthening awareness of the importance of the creative industries, creativity and design, appreciation for creative work and the willingness to engage in new things are the foundations for the development of the creative industries. They let - figuratively speaking - the creative industries sprout.
"Simple" but not negligible prerequisites for the settlement of creative people in rural regions are an affordable quality of life, an open mentality - keyword "creative milieu" and willingness to cooperate - and "tangible" decision-makers who facilitate the progress of creative people and creative economy initiatives.
The classic location factor "space and real estate" also plays a central role for the creative industries. The provision of attractive and affordable spaces, vacant buildings or cheap building sites can become a locational advantage for creative professionals. The creative industries are also dependent on infrastructure - both public and individual local transport as well as the data highway.
Through intelligent, long-term positioning and, if necessary, the development of a branding concept in the sense of location marketing, a region can communicate its strengths in a targeted manner and thus attract creative people.
For the implementation of support measures in the regions, it is important to embed the regional creative industries strategy in higher-level development plans and strategies. An analysis of the initial situation and an analysis of the needs of the creative industries companies allow for target group-oriented action. In this respect, the high heterogeneity of the creative industries makes it necessary to identify the areas of the creative industries that are important for the region in terms of specialisation and the interfaces to other economic sectors and to address them with appropriate measures. By involving strategic cooperation partners (regional management, chamber of commerce as well as other interest groups, associations and federations) at the federal and regional level, a sustainable, integrative approach can be pursued. Furthermore, a broad involvement of actors from business and industry, from culture and education as well as from the "independent cultural scene" at local and regional level is crucial. The demonstration of successful examples ("best practice") of creative enterprises as well as cooperative relationships can be beneficial by setting an example.
In summary, it can be said that the creative industries are a vital part of the Austrian economy that has also shown itself to be comparatively resistant to crises. Although the majority of creative enterprises are located in cities, there are also creative industries and creative enterprises in rural areas that are strongly anchored in their region - their number is growing and they have the potential to contribute to the development of the region.
Against this background, it is important to challenge and promote this highly innovative service sector, also with regard to Austrian competitiveness and regional development.
