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Posts Tagged ‘economy’

Philadelphia Orchestra
Philadelphia Orchestra (Ryan Donnell / Philadelphia Orch)

Many nonprofit organizations have been working through lean times since the crunch of 2008. Some orchestras have had to program carefully to limit costs for soloists, music licensing, and supplemental personnel. They’ve cancelled tours and recording projects, taken pay cuts, laid off staff. They’ve reduced their number of concerts.

The Philadelphia Orchestra has gone farther. On Saturday they played Mahler’s Fourth just hours after their board had voted to send the orchestra to bankruptcy court. According to board chair Richard Worley, "We’re running low on cash, we’re running a deficit, and we have to put ourselves in a position to attract investment funds to help us."

The decision wasn’t unanimous. Several board members abstained, and all five musicians on the board voted against the resolution. Some of the musicians believe that the move is partly intended to force renegotiation of their contract. Management reportedly has been considering bankruptcy for more than a year, after deciding it could no longer afford to contribute to the musicians’ pension fund.

As board members entered the offices of their law firm Saturday, musicians were waiting for them. They handed the board members leaflets encouraging a "no" vote, as a string quartet played Schubert and Mozart.

The orchestra expects 2011 income of $33m against $46m in operating costs. The orchestra has a $140m endowment, but use of those funds is restricted.

Some observers blame simple mismanagement, but surely the causes are many. Attendance has been off, and in fact there were reportedly quite a few empty seats at Saturday’s concert. Critics have blasted the orchestra’s 9 year old home, the Kimmel Center, as visually rewarding but sonically cold. The orchestra’s board indicated that they’d be reviewing the rental fees for Kimmel as they try to emerge from bankruptcy later this year.

Although some smaller orchestras have had to seek shelter from creditors, to my knowledge, Philadelphia is the first major American orchestra to take this step. "We’re in a state of shock, really," said principal oboist Richard Woodhams. "I think it’s a very, very sad day for culture in the United States and the world."

The belt-tightening continues at orchestras across America and round the world. This month (March 2009) the Philadelphia Orchestra pink-slipped a dozen staffers and the Pittsburgh Symphony released nine. The New Jersey Symphony dismissed three. The Atlanta Symphony announced pay cuts of 5-7 percent and furloughed staff members. Since last fall the Cincinnati Symphony have given 8 staffers their walking papers, and gotten their musicians to take an 11% pay cut. The list goes on, I’m sorry to say.

Many orchestras are planning shorter, simpler, cheaper concert seasons. Increasingly, they’re turning to their own principals for solo work in concertos, and asking guest soloists to moderate their fees. (Pianist Emanuel Ax graciously waived his fee entirely for last weekend’s concerts with the Columbus Symphony.)

Severance Hall Pediment (Wikimedia Commons)

Even the mighty Cleveland Orchestra isn’t immune. The same budget beasts battering orchestras in other cities are now clawing at Severance Hall’s doors. Private and corporate donations are down, ticket sales are down, and the orchestra’s endowment fund is down — this last by over a quarter. They’re looking at a possible shortfall of over $7 million — a tough situation for an orchestra that was already in recovery mode after years of deficits.

In response, the orchestra will trim their season and their touring (though perhaps not their performances in Miami, which so far have proven to be revenue champs). They’ll choose repertore to minimize the need for overtime and substitute musicians.

Unlike many of the others, Cleveland has chosen to cut salaries instead of staff. Music director Franz Welser-Moest is setting an example with a 20% giveback, executive director Gary Hanson is letting go of 15% of his pay, and other top brass are swallowing a 10% reduction. Nonunion lower level staffers will see 5% less in their pay envelopes. The orchestra’s managment also plan to ask the players for more “operational flexibility” when their contract comes up for renewal in August.

All this cost-cutting may balance the books for the upcoming season. I certainly hope it does. But if endowment revenue and business support continue to slide, what will Cleveland and the rest of the world’s music makers do? For most US orchestras, ticket sales now cover less than 40 percent of their costs. Where do you suppose the rest comes from?

I’m far from an expert on these matters — I’m the classical music geek at a public radio station, for goodness sake, not an arts administrator — but I wonder if orchestras might harvest some idea from us — that is, public radio — and maybe even from Hollywood.

In the offices of NPR and at stations large and small all across the country, public radio faces a decline in contributions from businesses and foundations. Just as with the orchestras, those who have endowments have watched them evaporate. And as with orchestras, many stations have had to trim operations and/or release staff.

The good news — and it’s deeply gratifying — is that listeners have stepped forward to help make up part of the revenue losses. As has happened in many (though not all) cases round the nation, WKSU’s Spring pledge drive met its goal, and even exceeded it by a small amount.

Meanwhile, the box office take is up for major motion pictures these days, reversing a long standing downward trend. Of course this has generated an inevitable comparison, with the film industry’s much-noted growth during the years of the Great Depression.

In the early 1930s, Hollywood reflected the grim times on the street — and they watched their box office returns dwindle. Their change of course as the tough times dragged on may have been partly driven by a sense of the public’s desire for more escapist fare, but in part it was forced on them by the rise of the Legion of Decency and the Breen Office. Regardless of the impetus, though, it’s hard to debate the fact that Fred Astaire and Ginger Rogers brought in more Americans worried about next week’s paycheck than did stories of gangster wars and political sleaze.

Now, consider Chicago Lyric Opera. They’re heading into next season in remarkly good fiscal shape. Why? It’s partly because they’ve been holding costs down for years, and they’ve gotten pretty good at it. But a good part of the reason is their repertoire. Their audiences have come to expect frankly conservative programming. The Lyric’s focus on favorites has earned them some catcalls from critics, but their director thinks the company’s current stability while others are teetering has vindicated his approach.

Other opera companies — and orchestras — are paying attention.

I, for one, am not about to criticize them for it. Hollywood’s experience suggests to me that, in tough times, audiences need and crave the comfortable and familiar. It takes courageous administrators to recognize this, and put their ambitious plans for new music and splashy productions on hold. Those uneasy listeners they thus put in their seats will forget their problems, at least for a couple of hours. Those listeners, and their friends, will help pull the orchestras through these dark times. The orchestras will survive, so they can again take risks and forge ahead in the (we hope!) more affluent future.

It wasn’t just lighter subject matter that filled the cinemas of the last 1930s. It helped a lot that producers and theatre owners slashed their costs and brought the price of a ticket down to between a quarter and a half dollar (depending on how deluxe an experience you wanted). As it turns out, that’s about $3.75 to $7.50 in 2009 dollars. Hmmm.

A music lover who’ll drop $130 for a pair of orchestra-level seats in good times might be a little more hesitant when he’s not sure he’ll have a paycheck in 6 months. For someone in that position, even the top row balcony seats may look unaffordable at half that price.

Although not every orchestra is losing listeners — England’s Philharmonia Orchestra, for example, says their ticket sales are holding up well, thank you — many of them are indeed seeing their attendance fall for this very reason.

In public radio, we’ve found that listeners who’ve been with us for years will often pledge upwards of $20 a month, a dollar a day, or even $1000 a year. They know us, and they know the value of our programs. But others who are just discovering us are, quite understandably, usually interested in making smaller donations. So we try to accomodate them. We offer a range of membership levels for listeners of different means and interest.

It seems to me that orchestras have to go beyond just balancing the books on business as usual. Maybe they can learn a little from our experience, and that of the Depression-era movie theatres. In addition to offering appealing concerts, they may have to further widen their range of ticket prices, fighting box office losses by offering some concerts at the regular price, a few at a premium with premium extras and — here it comes — at least some concerts at prices that folks with very limited means can afford.

Kudos to The Cleveland Orchestra for their plans to offer reduced ticket prices for first-time concertgoers and younger people next season. That’s the kind of flexibility that will help keep people in the habit of hearing music live, even if their finances have tightened.

Can we go still further?

Again, remember that I’m not an expert here, so perhaps I’m being naive. If you’re familiar with the issues, feel free to put me in my place with the comments section below. But I think that, in these difficult times, orchestras need to find ways to lower the barriers as much as possible. I have a couple of suggestions.

First, why not fill space that’s currently unused? In Europe many musical organizations offer standing room in the back of the hall for around $5 to $15 per head (or pair of feet), usually on a first come first served basis, no printed program provided.

I’ve stood in Severance Hall, and no doubt will again, but standing room seems less often offered here in the States than in Europe. Is this an area for growth? I suppose it’s not very practical for a family with kids, but couldn’t cheap standing room tickets — say, five bucks — keep a financially stressed music lover coming to concerts until his or her situation improves, or introduce a penurious student to the pleasures of real live music?

Secondly, what about the scale of the concerts themselves? Not every great work requires a full orchestra. We needn’t go as far as Ernest Fleischmann suggested over 20 years ago in his proposal to convert the orchestra into a "community of musicians," but a little more flexibility in orchestra structure and programming could open the doors for a wider audience.

I’m suggesting that some orchestras might consider converting one or more season concerts into chamber orchestra concerts, perhaps even playing them at less traditional locations.

I don’t mean to tread on any musicians’ toes with this notion. From what I understand — please correct me if I’m wrong — union rules make this sort of compromise tough, and for good reasons, so it may take some stretching all round. But there’s a sizable repertoire of substantial, rewarding chamber orchestra works from the 18th to the 21st centuries. By its very nature, the form is less resource-hungry: a smaller corps of players, a smaller space, and smaller crews all add up to more affordable ticket prices. This could bring in music lovers who otherwise might seldom or never see a live concert because of the cost.

Don’t misunderstand me. I’m not suggesting that I have some kind of prescription for struggling orchestras. As I said above, I’m no insider. But whether these ideas are usable ones or not, I think orchestras should be looking at ways to make concerts more affordable for music lovers whose resources are strained.

One way or another, our musical organizations will work through these difficulties. They have to. We need them, to keep live music available for the next generation and the one after that.

Further listening:

Cleveland Orchestra announces 2009-2010 season (with reporter Vivian Goodman) in WKSU News

Further reading:

Cleveland Orchestra plans deep cuts at the Plain Dealer

Orchestras plan fewer concerts at The Telegraph

BSO lays off staffers at the Baltimore Sun

Facing the music … Philadelphia Orchestra at Metromix Orlando

Big-league pianist steps up to plate at Columbus Dispatch

State’s top orchestra faces changes at the New York Times (registration may be required)

Hollywood and the Great Depression at Digital History

Hard Times: just what the box office ordered at The Wrap

Cincinnat Music Hall (Wikimedia Commons)

Keeping an orchestra or opera company running in the black — sometimes, just keeping it running — is no mean feat in the best of times. In the current economic climate, the folks who put on concerts for us, in the US and around the world, mostly have little choice but to hunker down and wait for the clouds to part.

It’s been a rough week in the music world.

• The Cincinnati Symphony, faced with a massive 3.8 million dollar deficit and a 25 percent drop in their endowment fund’s value, announced drastic measures. Since September they’ve released eight administrative staff members. Nearly everyone left has swallowed pay cuts — staff, music director Paavo J√§rvi, and now the musicians. Yesterday (Monday 2 February 2009) the orchestra’s players agreed to an eleven percent reduction in salary.

Cincinnati’s recording program has been relegated to limbo. Cleveland’s Telarc Records was scheduled to record The Pops Goes British next week in Music Hall. It’s cancelled, as are all future recordings, though three already in the can are still slated for release.

• The Philadelphia Orchestra asked next season’s guest conductors and soloists to accept lower fees. Large-scale works such as Richard Strauss’s Elektra were axed from the programs. They’d already cancelled their 2009 tour of European festivals, and decided not to renew their innovative relationship with Finland’s Ondine Records. Internet concert simulcasts are out, too.

• The Rochester Philharmonic joined the red-ink crowd, announcing a deficit of $161,000 on an annual operating budget of $10 million. They blamed staff turnover, an increase in programming and administrative costs, and a $280,000 revenue hit.

• The Met expects a double-digit deficit. Their endowment, like many, has declined precipitously, as have donations and ticket sales. San Francisco Opera, faced with the end of their city subsidy, is looking at a $71 million shortfall.

• The Opera Orchestra of New York was to perform Wagner’s Rienzi on 19 March (2009) and Cherubini’s Medea on 21 April, but this week they cancelled both. They’d already axed a concert with bass Ferruccio Furlanetto, originally set for the 27th of February.

• LA Opera pink-slipped 17 staffers and announced pay cuts of 6-8% for the rest. They hope to slice their budget by 25% for next season, mainly by renegotiating union contracts and reducing the season from 64 to 48 performances.

• The Bolshoi Theatre cancelled a Mexican tour and a new performance of Verdi’s Otello.

But wait! Amid all this darkness, we find a couple of glimmers:

• The LA Philharmonic, riding a giddy wave of elation over its new, much-discussed young music director, Gustavo Dudamel, has no plans for any cutbacks at all.

• Chicago Lyric Opera is forging ahead with their long-range plans and won’t need to change a thing in next season’s programming. General director William Mason gets much of the credit; he’s carried forward the lean, fiscally cautious policies of his predecessor, Ardis Krainik. Although Mason’s been criticized for musically conservative programming, he thinks his approach has now been “vindicated.”

Further reading:

Cincinnati Symphony falls $3.8M short

CSO musicians agree to pay cut

Economy is forcing Philadelphia Orchestra to scale back

Rochester Philharmonic Orchestra posts deficit

LA Opera announces cutbacks

San Francisco Opera tightens belt

Opera Orchestra of New York cancels remaining performances this season

Crisis forces Russia’s Bolshoi to scrap opera

Fiscal prudence enables Lyric Opera to enter 2009-10 without fear and trembling


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