Rockonomics

by Alan B Krueger

  The conventional wisdom is that the Dixie Chicks paid a sizable economic penalty for Ms. Maines’s outspokenness. One article reported that the incident led “to the virtual demise of the band.”43 Looking back at the controversy, Maines herself said, “I feel like we are tainted. I don’t know if we put a tour up, if people would come.”44

  The reality, however, is more nuanced. A consideration of hard data suggests that the economic consequences were relatively minor, on net. On one hand, the group’s record sales may have lagged after the controversy, and they lost a promotional opportunity with the American Red Cross. Their single “Landslide” fell off the Billboard chart after reaching number ten. On the other hand, their touring revenue in 2003 remained healthy, and there is no sign that ticket sales waivered. The Dixie Chicks played forty-two sold-out shows in the summer of 2003 as part of their Top of the World Tour and grossed just over $40 million in that period, according to my tabulation from data in the Pollstar Boxoffice Database. The band’s next major tour was the Accidents and Accusations World Tour in 2006, which grossed $34 million from fifty shows. A handful of shows were cancelled because of low demand, but others were added, notably in Canada and Australia. Their 2006 album Taking the Long Way debuted at number one on the Billboard 200 chart, sold more than 2.5 million copies in the United States, and won five Grammys. The album’s top single, “Not Ready to Make Nice” (written by the three band members and Dan Wilson), commemorated the controversy and became the band’s only song to be certified platinum and reach the top five of the Billboard Hot 100. In 2016, the band grossed $52 million from sixty-eight shows. Given that musicians derive most of their income from live concerts, it is plausible that the Bush controversy caused a drop in their income. But most other bands would be delighted to make the touring money the Dixie Chicks were able to garner after the controversy.

  Why didn’t they pay a larger economic price? A few factors probably offset the firestorm of criticism directed at the band. First, the controversy generated attention and publicity, supporting the old adage “All publicity is good publicity as long as your name is spelled right.” Second, although some fans may have been turned off by Natalie Maines’s comment, the band gained new followers, especially outside the United States. Third, even for superstars, concerts are a niche market. The Dixie Chicks’ 2003 Top of the World Tour sold around 900,000 tickets in the United States in 2003.45 With a population of close to 300 million people in the United States at the time, that amounts to less than one customer per 300 people. This is quite a different market than that for products such as Dove soap, Coca-Cola, or Bayer aspirin, which are purchased by a much higher percentage of households. The Dixie Chicks could afford to offend a segment of their fan base and still sell out because they continued to have a strong niche following. And one can argue that many of their fans became more devoted because of Maines’s political stance.

  Gold Isn’t All That Glitters

  Music makes a relatively small contribution to the economy in terms of the amount of money consumers and businesses spend on music and the incomes and jobs afforded by the music industry. The effect of music on our lives, however—as suggested by the considerable amount of time we spend listening to music, and the intense feelings that music evokes in us—is greatly out of proportion to its economic impact. For consumers, music is probably the best bargain ever.

  Music transcends its economic value precisely because of the powerful emotional connection it creates with listeners. The emotional bond between musicians and their audiences is what sells records and concert tickets, and enables musicians to have an outsized influence on social causes. The “soft power” of music can topple autocrats and soothe souls. As Bono has said, “Music can change the world because it can change people.”46

  * Fletcher’s actual quote was less poetic, but the sentiment was the same. Centuries later, the great economist Paul Samuelson would have his own riff on this line: “I don’t care who writes a nation’s laws—or crafts its advanced treatises—if I can write its economics textbooks.”

  CHAPTER 3

  The Supply of Musicians

  There’s a reason they call it playing, not working.

  —Max Weinberg

  Max Weinberg, the longtime drummer for Bruce Springsteen and the E Street Band, has told me on more than one occasion that performing music is great fun; there’s a reason musicians call it playing and not working, he says. When he once let me climb onstage and bang the tambourine to “Glory Days,” I got a small glimpse of what he meant. Even the illusion of entertaining a live audience is pure joy.

  Weinberg has had a storybook career. In 1974, while attending college and playing drums in Broadway pit bands to help make ends meet, he came across an ad in the Village Voice that said the E Street Band was auditioning drummers. He was the fifty-sixth of some sixty-plus drummers to audition. He didn’t know much about Springsteen or the band at the time, but he’d never seen a band so focused on its leader. After the audition he told Bruce, “I don’t know who you are going to choose, but I’ll tell you what, I’ll play with you for nothing.”1 His father didn’t object when he left school a handful of credits shy of graduating and postponed plans for law school to join the band. A year later, Bruce Springsteen and the E Street Band had their first hit, “Born to Run.” More than forty years later, the drummer whom the Boss calls “Mighty Max” says, “I’d still do it for nothing.”

  A passion for creating and sharing music is what draws most musicians into the profession and keeps them there despite the long odds of achieving commercial success or fame. Many describe the appeal of music as if it were a religious calling; they simply can’t imagine spending their lives doing something else. From an economic standpoint, this inner drive creates a ready supply of musicians who are willing to sacrifice higher income and steadier work in order to practice their art. The lucky few are paid, as the Bruce Springsteen lyric says, “a king’s ransom for doin’ what comes naturally.”2 The rest just do what comes naturally and struggle to make ends meet.

  Musicians by the Numbers

  There were 213,738 workers in the United States who identified their main occupation as “singer, musician or related worker” in 2016, according to Census Bureau data.3 These musicians represented only 0.13 percent of all employees that year; musicians’ share of the workforce has hovered around that same level since 1970.

  What do we know about working musicians? First, their salaries as a group are low. The median musician earned $20,000 in 2016, some $15,000 less than the median of all other workers. Lee Sims, who hustled to make ends meet, is more representative of musicians than his son Paul Simon.

  Second, about two-thirds of musicians are men; the gender balance in the overall workforce is much closer to parity. And while women have increased their share of the U.S. workforce since World War II, there has been essentially no change in the two-to-one ratio of male to female musicians since the 1970s.

  Third, 13 percent of professional musicians are African Americans, which is close to the share of African Americans in the workforce overall. Hispanics, by contrast, represent a much smaller share of musicians than their share of the workforce overall: 10 percent of musicians are Hispanic, versus 17 percent of the workforce. Following trends in the rest of the workforce, however, musicians have become more racially diverse over time. In 1970, 89 percent of musicians were white non-Hispanics. In 2016, their share was down to 71 percent.

  Fourth, professional musicians are a little overrepresented in the South, but by and large they match the geographic distribution of people across the United States.

  Despite the image of musicians as young school dropouts with wild hairdos, as a group musicians are actually older and better educated than the workforce overall.4 The average working musician was forty-five years old in the latest data available—four years older than the average worker overall. Only 4 percent of musician
s left school before completing high school, which is less than half the dropout rate of other workers. Fully half of musicians are four-year college graduates, compared with one-third of the workforce overall.

  The gig economy started with music. Not surprisingly, musicians are almost five times more likely to report that they are self-employed than non-musicians. In 2016, 44 percent of musicians were self-employed, while just 9 percent of other workers were their own boss. Like other freelancers, self-employed musicians have the freedom to perform their work however they please and to work for a variety of employers. But they also face greater risk than traditional employees when it comes to finding steady work, and they are responsible for managing their own careers, securing benefits, and saving for the future without the aid of a human resources office.

  About 30 percent of musicians currently work for a religious organization as their main gig. There are a lot of church choirs and organists. A great many singers got their start performing in church, including Aretha Franklin, Whitney Houston, John Legend, Katy Perry, Faith Hill, Justin Timberlake, Janelle Monáe, Usher, and many others.

  The average musician earns income from engaging in three distinct music-related activities a year, according to a survey of 1,227 musicians that Princeton’s Ed Freeland and I conducted in 2018.5 Live performances are the most common source of income. Eighty-one percent of professional musicians earned income from performing live events over the course of a year. The second- and third-most-common sources of income are giving music lessons (42 percent) and performing in a church choir or other religious services (38 percent). These three activities accounted for more than two-thirds of the average musician’s music-related income. They also take up a lot of time. The average musician spends 14.1 hours a week performing or rehearsing for a performance, 5.7 hours traveling to or from performances, and 3.6 hours giving music lessons.

  These statistics tell us who works as a musician, what they do to make a living, and how much they earn, but not how and why they became musicians—neither the joy they derive from music nor the hurdles they face in pursuing their passion. In other words, they tell us everything about the backgrounds of musicians except what makes a musical career magical and maddening.

  Gigging for a Living

  The term gig was coined by jazz musicians in the 1920s to refer to a short engagement to perform music. Life as a jazz musician then, and now, often involved traveling from one town to the next to play a set or a show. The term stuck and eventually spread outside of music. Any temporary paid work today is often referred to as a gig.

  In the age of Uber and Airbnb, gig has taken on additional meaning, often referring to a short-term work assignment through an Internet app that matches customers and workers. Both online and offline, gig work has grown in the United States in recent years, although the amount of money is relatively small.6

  Freelance musicians account for most of the growth in musician jobs since 1970.7 There are two main drivers of this trend. First, record companies have been under intense competitive pressure to reduce costs because piracy and file sharing have cut into revenues. Second, technology has made it easier for parts of music jobs to be outsourced and carried out remotely. And the proliferation of Uber-like online platforms that match musicians with gigs—such as GigTown.com, Gigmor.com, and ShowSlinger.com—is likely to propel freelance musical work in the twenty-first century.

  Musicians have long been at the vanguard of the gig economy, facing many of the same problems that gig workers face today: obtaining health insurance, saving for the future, paying down debt, planning for taxes, and recordkeeping. In 2013, before Obamacare established health insurance exchanges and provided income-based subsidies for individuals to purchase insurance, 53 percent of musicians lacked health insurance, which was triple the uninsured rate for the population as a whole.8 Self-employed workers as a whole saw a greater rise in health insurance coverage after Obamacare passed than other employees. The health insurance coverage rate of musicians jumped to 86 percent by 2018.9 Not surprisingly, musicians and other freelancers have generally been more supportive of the controversial law than the public as a whole.10 Given the mental stresses and physical wear and tear that a musical career entails, the low rate of health insurance coverage historically has been a serious problem for musicians.

  Musicians, like other gig workers, struggle to find enough work. New Jersey musicians I’ve interviewed often say that gigs used to be easier to come by, and that their pay—around $100 for each musician per performance—has hardly increased over recent decades.11

  Another challenge musicians and other gig workers face is getting paid. Musicians tell countless stories of being stiffed by club owners and promoters. Their experience is not unique. A quarter of self-employed workers overall say that they were paid less than they were owed at some point in the past year.12 Aretha Franklin and many others used to insist on being paid in cash before performing.

  Today, bands hire their own accountants to collect the money from the shows they perform, and they then pay their manager’s commission. In the early days of music, it was the manager who would pay the performers. As one manager told me, there are lots of ways that a manager can lose artists; this practice eliminates one of them.

  In light of the very real challenges that musicians face earning a living, Billy Joel’s advice to young musicians is worth repeating: “Deciding to become a musician for life is a big decision, and it’s scary because there’s no safety net. A lot of your friends will say you’re crazy; you’re never gonna make it. Your parents worry about how you’re gonna make a living. Most musicians that play in clubs or restaurants have to have another job.”13

  Human Capital

  As noted, musicians as a whole are well educated. This is not so surprising, perhaps, given that music mastery requires years of devotion and practice, the same attributes that are necessary for academic achievement. Even those who drop out of high school to pursue a musical career often possess the focus that could lead to educational excellence.

  Despite Pink Floyd’s claim that “we don’t need no education,” training and devotion to one’s craft are key ingredients to success in music. Education and training build what economists call “human capital.” Decades of research has found that human capital is an important contributor to economic success for both individuals and countries. My statistical analysis shows that professional musicians who graduated from college earn considerably more income than those who left school after high school.

  Grammy Award–winning songwriter Dan Wilson has said, “Even to be a moderately successful musician takes a huge amount of repetitive effort and a lot of luck. The repetition is necessary for practice but also as fertile ground for the luck.”14 The economic and professional benefits that accrue from practice, persistence, and training can be seen in the music industry’s most successful bands, such as the Beatles and Rolling Stones. Even a presumed slacker such as Kurt Cobain recognized the fundamental role of human capital in musical success. In a letter dismissing his drummer, Dave Foster, from Nirvana, Cobain admonished, “A band needs to practice, in our opinion, at least 5 times a week if the band ever expects to accomplish anything.”15 Even immensely successful bands, such as Bruce Springsteen and the E Street Band, still rehearse on the day of every show, even after decades of performing together. Practice may not make perfect in music, but a lack of practice is a sure way to turn a symphony into a cacophony.

  The Magic of Music

  What draws people to pursue a career in music? After interviewing music stars and newcomers and reading several musicians’ own accounts, I am convinced that the main reason—and the best reason—for pursuing a musical career is a deep, abiding love of music, one that creates a nearly mystical appeal, rather than dreams of fame or fortune.

  Nile Rodgers, the legendary singer, guitar player, record producer, songwriter, composer, and arranger,
gives a simple and yet often told explanation for what draws him to music: “to be heard.”16

  Patti Smith describes the creative process in mystical terms: “The artist seeks contact with his intuitive sense of the gods, but in order to create his work, he cannot stay in this seductive and incorporeal realm. He must return to the material world in order to do his work. It’s the artist’s responsibility to balance mystical communication and the labor of creation.”17 Who, after all, could resist an opportunity to talk to the gods?

  Bob Dylan, too, alludes to the transcendent appeal of music: “Songs, to me, were more important than just light entertainment. They were my preceptor and guide into some altered consciousness of reality.”18

  Jason Pierce of the alternative rock bands Spiritualized and Spacemen 3 explained the allure of music this way: “All I know is I feel so alive when I’m out there playing and that makes me want to keep going more than anything else.”19 Sheila Stratton-Hamza, a sixty-year-old blues singer who attended one of my focus groups, said, “I’m in pain before taking the stage, but euphoric once performing. I feel my essence comes out. I’m transformed as a person.” Jacob Collier, a humble, multi-talented twenty-four-year-old musician who won two Grammys for music he created in his bedroom, told me that he feels “invincible” when he is on tour.20 Remembering that he has a serious peanut allergy is the only thing that brings him back down to earth, he said.

  Musicians that I surveyed highlighted the opportunity for artistic expression, performing, and collaboration with others as their favorite aspects of being a musician. They overwhelmingly selected “financial insecurity” as their least liked aspect of being a musician.21