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Introduction
Introduction
Design & Crafts Council Ireland commissioned Grant Thornton to conduct a study into the economic contributions of design and craft to the Irish economy, and to identify the wider benefits provided by the industry.
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Design & Crafts Council Ireland (DCCI) is the national agency for the commercial development of Irish designers and makers, stimulating innovation, championing design thinking and informing Government policy. DCCI’s vision is that Ireland is recognised and valued for its culture of design and craft. To raise the standard, profile and economic impact of Irish design and craft, DCCI provides a range of programmes, supports and services for designers and craftspeople, learners and teachers, retailers and gallerists, shoppers and collectors, media and partner organisations. DCCI have almost 3,200 registered client enterprises of whom over 200 took part in Showcase 2019 (Ireland’s creative expo) raising revenue of €160 million. The corresponding 2020 event welcomed buyers from 2,760 retail businesses in 26 countries and featured over 400 creative brands, including 50 debuting at Showcase. The event saw year-on-year sales growth of 4.6%.
Introduction
The concepts of design and craft are broad, meaning different things to different people in different contexts.
The two concepts can be broadly defined as: • Design is a process of imagining and planning the look and function or workings of
an object before it is made.
• Craft is an artisan activity involving skill in making things by hand. However, when the word design is used to define a business activity, several seemingly different things may come to mind, i.e. industrial or engineering design as compared to architectural design, or even fashion design. The same can also be said of craft. In short, there is no one agreed definition of design or craft or the business, activities, and roles which form those sectors. This was a key challenge in undertaking research to quantify the economic impact of the sector.
What is clear from anecdotal evidence and previous research is that the industries defined as falling within these concepts represent a range of diverse businesses and activities. These businesses have played an increasingly important role in the social, cultural, and economic growth of Ireland in recent years. Grant Thornton was engaged by DCCI to conduct an independent analysis of the sectors to calculate the value of this economic contribution to the Irish economy and identify the wider benefits provided by the industry.
Methodology
Grant Thornton, in collaboration with DCCI and Market Dynamics, conducted a series of research engagements, including stakeholder consultations, a survey, and case studies.
While the results of these are not representative of all craft and design practitioners and organisation in Ireland, they do provide indicative evidence and insights.
Stakeholder Consultations Survey Case Studies
These were conducted with a selection of individuals and organisations considered to be key stakeholders of the wider industry and businesses directly involved in design and craft. Stakeholders were categorised as: The DCCI Annual Client Economic Survey was developed in partnership with Market Dynamics and was issued to DCCI’s client base. This was one of the largest survey of DCCI clients ever undertaken and it resulted in responses from 689 businesses. A selection of design and craft enterprises were identified as examples of some of the key emerging themes from the consultation process and were analysed further to provide additional insights.
• Craft and Design
Businesses
• Enterprise
Development
• Innovation and Design • Tourism
• Culture and the Arts
• Education and Skills
• Government • Shock of Grey • Criostal na Rinne
Data Analysis
Underpinning this report, and driving many of the estimations of key economic indicators for the sectors, is the data analysis approach. In all cases, we have utilised prudent assumptions to ensure that the outcome of this analysis is guided throughout by the principles of maintaining a logical, evidence based rationale. The absence of a definitive definition of the craft and design sectors provides an immediate challenge in seeking to assess the impact and value of the role the sectors play. There have been several previous reports emanating from Ireland and other jurisdictions which have sought to provide such a definition, including: • Economic Significance and Potential of the Crafts Sector in Ireland (2010); • Innovation through craft: Opportunities for growth (2016); • Winning by Design (2017); and • Together for Design (2020). There is little consistency to be found in these approaches. A rigid approach to any specific definition risks excluding designers or craftspeople who work within other, more broadly defined categories, or including others who would not ordinarily be considered as such. For example, with regards design, the Irish Design Footprint report (2016) estimated that the design sector, as it defined it, contributed circa €38 billion in exports in 2013. However, when analysed further, the report recognised that >98% of that value was generated by the Digital Design Group (Computer Programming Activities, Software Publishing, Publishing of Computer Games), with Design-Engineering, Design-Architecture, Design-Specialised, Design-Advertising and Design-Craft accounting for just 1.28% of that value. Similarly, it must be recognised that even within categories that may be defined as craft related, an assessment must be undertaken as to whether this involves ‘traditional craft’ or ‘industrialscale craft’ enterprises. Another methodological challenge arises in selecting appropriate data sources and approaches to derive estimates for key economic variables such as employment, GVA or productivity. A ‘one-size-fits-all’ approach to the sector definition and categorisation of the sector across datasets would be unlikely to provide the robust analysis required. For the purposes of the analysis contained within this report, three separate categories are identified, namely: • Craft
- Includes any object that has been made (usually) by hand by a craft maker. Disciplines can range from ceramics and glass to jewellery and furniture, encompassing small batch production or stand-alone unique pieces of work, and may include the use of more unusual materials.
• Design-Intensive - includes professional design services across many disciplines including graphic design, branding and creative advertising, print and packaging, architecture, product design and service design. It also includes design professional working in the wider industry. For the purposes of this report we have defined design-intensive enterprises as ones which contain a significant proportion of design professionals and whose primary output is design focused. Activities such as Web design, brand design or architectural consultancies would be included here
• Design in Other Sectors - considers activity in non-design industries that engage design professionals but who do not make up the majority of employees and whose primary output may not be design focused. Examples of this include in house designers in manufacturing, engineering or professional services companies.
The graphic below highlights the variety of activities which are categorised as ‘designintensive’ and ‘craft’, and shows the diversity of enterprises.
Textile Making Furniture Making Software publishing
JewelleryWoodworking Glass Making
Ceramics Metal Working Architectural and Engineering Consultancy These were defined in collaboration with DCCI through a two-step process. First, a Nomenclature of Economic Activities (NACE) analysis was conducted at a four digit level to select the most appropriate NACE codes for the design and craft sector. NACE codes are the industry standard classification system used in the European Union to classify different business activities through a hierarchical structure with each additional level providing increasingly granular data.
NACE codes provide a framework for the collection and presentation, based on economic activity, of a wide range of statistics in economic fields such as production, employment, national accounts, and others. The statistics produced are comparable at a European and more generally at a global level. Secondly, those NACE codes considered to be ‘design’ were subject to analysis which considered whether those codes were design ‘Intensive’, or made a contribution to a wider non-design specific sector. NACE codes used are included in the Appendix.
Figure 1: Example of the make-up of a NACE code
Level 1 C
Manufacturing
Level 2 C23
Manufacture of other nonmetallic mineral products
Level 3 C234
Level 4 C2341
Craft and Design-Intensive Sectors
A number of enterprises within the broadly defined ‘craft and design-intensive’ sectors were of significant ‘industrial’ scale and therefore were not considered as ‘craft’ for the purposes of the study. For example, one NACE code included a multinational cosmetics company which had a disproportionate impact on the key economic metrics being measured. Exclusion of these large scale entities reflected a desire to capture ‘craft’ in terns of scale. Analysis of DCCI’s Annual Economic Client Survey determined the typical size of enterprise that operates within the craft and design-intensive sectors. This established that craft enterprises can be typically characterised as micro, small or medium sized and typically have less than 50 employees. Consultation with DCCI provided guidance on this analysis. As a result, data which draws from national statistics excludes enterprises with greater than 50 employees. Analysis of the design-intensive sector, using the same approach outlined above, indicated that these were typically small, medium and larger enterprises which utilised more mechanical technique than the craft sector and so were of larger scale. The enterprises which combine to make up the craft and design-intensive sectors are the key area of focus for this report. It is important to note that there are a small number of cases in which enterprises are considered as both craft and design intensive. When aggregating craft and design intensive activity, this potential to ‘double count’ have been removed.
Design in Other Sectors
Following consultations with stakeholders and DCCI, Grant Thornton noted that design has a wider reach in the economy than is illustrated through the inclusion of just the designintensive sectors e.g. some elements within the IT sector, which would not be considered as a ‘design-intensive’ sector in this analysis, will have design elements. To capture these design related elements, Grant Thornton, drawing on an approach outlined in The Design Economy (2018) report published by the Design Council in the UK, identified design related occupations (see Appendix for a definition). Using these design related occupations, Grant Thornton was able to identify the proportion of these occupations within each sector through an ‘occupation by sector matrix’. To ensure consistency and comparability with the methodology and results for the craft and design-intensive sectors, Grant Thornton used data gathered from the Annual Detailed Statistics for Industry/Services published by the CSO and Eurostat. These data sources again provided us with a range of economic indicators, including: GVA, Turnover, Persons Employed, etc. Using the proportions of the identified Design related occupations within each NACE sector, Grant Thornton were able to calculate the economic contribution of the ‘Design in other sectors’. In some instances, for the sake of comparison to other business sectors, this has been combined with craft and design-intensive sectors to present aggregate figures for the craft and design sector. As part of our methodology, we have utilised a range of different sources of data to inform our analysis including: • DCCI Register of design and craft businesses; • DCCI commissioned survey of design and craft businesses; • Central Statistics Office; • Eurostat; • FAME Database; and • Office of National Statistics.
Methodological Approach Employed
01
Desk based assessment to define design and craft Sector defined in broadest sense using NACE codes
06
Assessment of key economic metrics turnover, GVA, wages etc.
07
Application of multiplier effects
02 03
Assessment of Ireland’s enterprise base by sector and size
05
Application of filtering to remove large-scale industrial activities from analysis
04
Assessment of DCCI survey by size/turnover
08
Full Economic Impact Assessment of Craft and Design Note: In all charts, 2020 is represented as a dotted line. This period relates to the impacts of the Covid-19 pandemic.
