Problems of Socio-economic Crisis Caused by Covid-19 Influence

on Creative Industries

Yu. O. Glushkova

, D. V. Filippov

, Yu. O. Yershov

and L. A. Podsumkova

Saratov National Research State University named after N. G. Chernyshevsky, Saratov, Russia

Keywords: Economy, Creative Industries, Pandemic, COVID 19 Coronavirus.

Abstract: President Vladimir Putin, in his speech to citizens on March 25, 2020, announced a number of measures aimed

at supporting the economy in the context of accelerating the spread of coronavirus infection on the territory

of the Russian Federation. These measures are focused on four areas (www.economy.gov.ru): 1. Providing

essential goods and supporting the population (monitoring consumer prices; monitoring the availability of

essential goods for sale; implementing measures to actively support employment; establishing a "green

corridor" for the import of essential goods). 2. Support for the sectors of the economy that are at risk

(exemption of tour operators from paying fees and establishing compensation for their losses; monitoring the

financial situation of developers and contractors; providing deferred tax payments for a period of 3 months to

organizations and industries most affected by the pandemic. 3. Support for small and medium-sized businesses

(a moratorium on inspections of small and medium-sized businesses; deferred payment of lease payments in

the case of using state or municipal property; provision of forms of concessional lending). 4. System-wide

measures (creation of a financial reserve of up to 300 billion rubles; creation of a guarantee Fund for

restructuring loans to companies affected by the deteriorating economic situation). Despite all the measures

taken, it is currently difficult to assess the real scale and impact of COVID-19 on the Russian economy. Today

(May 10, 2020) there is a deterioration of the sanitary and epidemiological situation in the country. Time will

tell how Russia will survive this pandemic and how much damage will be done to the economy. Theoretical

analysis. The article provides a theoretical analysis of the crisis in the creative industries, as well as a detailed

review of the opportunities and threats of the crisis. Results. Based on the generalization of scientists' views

on the pandemic, the advantages and threats to the creative cluster are identified. According to the results of

the research, problematic issues were identified due to the specifics of the development of the creative sphere.

1 INTRODUCTION

As of 10.05.2020, 4,044,198 cases of Covid-19

coronavirus were officially recorded in the world in

187 countries. At the moment, 2,382,161 people are

sick with coronavirus infection in the active phase.

The total number of deaths from the coronavirus is

279,609, which is 6.91%. Confirmed cases of full

recovery from coronavirus Covid-19 in the world is

1,382,428. The spread of "COVID-19" in different

countries is shown in Figure 1.

In the current conditions, most of the leading

Russian experts - economists are sounding the alarm.

https://orcid.org/0000-0001-6793-2441

https://orcid.org/0000-0002-0681-5855

https://orcid.org/0000-0002-3404-2730

https://orcid.org/0000-0001-9057-6772

In their opinion, as a result of the rapid spread of the

coronavirus pandemic around the world, and due to

the negative impact of this pandemic on the world

economy, the Russian economy will also face a

number of significant financial and economic

problems. It is expected that the level of gross

domestic product (GDP) of Russia, under the

influence of the pandemic, may decrease by at least

10-20%, another important factor of negative impact

is the level of prices for energy resources in the world

market. It is predicted that in the near future, average

annual oil prices will not exceed the $ 25 mark, and,

as you know, oil is the main Russian exported

Glushkova, Y., Filippov, D., Yershov, Y. and Podsumkova, L.

Problems of Socio-economic Crisis Caused by Covid-19 Inﬂuence on Creative Industries.

DOI: 10.5220/0011117500003439

In Proceedings of the 2nd International Scientiﬁc and Practical Conference "COVID-19: Implementation of the Sustainable Development Goals" (RTCOV 2021), pages 197-202

ISBN: 978-989-758-617-0

197

Figure 1: TOP countries by number of cases of coronavirus.

commodity (1prime.ru).

Coronavirus pandemic has changed expectations

for 2020 - recession awaits the global economy.

According to forecasts of the Economist Intelligence

Unit, it will fall by 2.2%, although it was supposed to

rise by 2.3%. The Russian economy will decline by

2%. Italy, Germany and Argentina will suffer most of

all. But if you look not at the big picture, but at the

details, it turns out that some industries will only

benefit - if, of course, they are able to competently

work out the increased demand.

Most of the G20 countries will enter a recession,

including Russia, which is forecast to decline by 2%.

According to the previous forecast of the EIU, the

growth in the Russian economy should have

amounted to 1.6%, according to the forecast of the

Ministry of Economic Development - 1.9%. In 2019,

the Russian economy grew by 1.3%, in 2018 - by

2.5%.

Due to the economic crisis and the unfavorable

epidemiological situation, the consumer behavior of

citizens will change, which will inevitably affect the

position of specialists in the creative sector - they will

be forced to look for ways to neutralize the

consequences of a difficult situation, Sofia Trotsenko,

founder of the Winzavod Foundation for the Support

of Contemporary Art and Dean of the Russian

Presidential Academy of National Economy and

Public Administration School of Design (RANEPA),

told TASS. "When discussing support measures, you

often hear that a crisis is a chance to sprout something

new, but this is not entirely fair, because it is very

difficult to build a company from scratch, and it is

important to protect those who have already done

something. (Kuzminov et al., 2019).

The creative industries have become one of the

areas hit hardest by the pandemic. Against the

backdrop of the spread of the pandemic, let us

consider which creative industries are developing

better and which are experiencing great difficulties.

2 THEORETICAL ANALYSIS

The COVID-19 pandemic is a pandemic (Kuzminov

et al., 2019) of the coronavirus infection COVID-19

caused by the SARS-CoV-2 coronavirus. It began

with the discovery at the end of December 2019 in the

city of Wuhan, Hubei province of central China, the

first cases of pneumonia of unknown origin among

local residents associated with the local animal and

seafood market of Huanan. On December 31, 2019,

the Chinese authorities informed the World Health

Organization (WHO) about the outbreak of unknown

pneumonia. Since January 22, the city of Wuhan has

been quarantined. The spread went to different

countries. In Russia, due to this virus, the event

industries - the entertainment industries - have

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suffered the most, but the government offers support

measures (financial) to support the industries, but for

this it is necessary to meet many parameters. In the

regions, for example, small financial subsidies are

allocated to support creative industries (this is the

sphere: cinema, art, museums.) In Kaliningrad, for

example, they are trying to overcome the crisis

through information and emotional moments, for

example, fashion brands have repurposed and began

to sew masks.

Alexey Bazhenov - representative of the business

community Be-in.ru: he talks about the situation in

which the Russian fashion industry is today, about the

search for identity within it and the importance of

refusing to copy Western partners, about the

problems of local fashion retail and production, as

well as about how the BE IN OPEN Forum is

developing, what mission it carries, and what results

have already been achieved over the three years of its

existence. Fashion is a social phenomenon, turning to

which business gets another competitive advantage.

Of course, there are a number of brands that don't

need it.

Active work of anti-crisis support to unite the

community: everything around has changed very

quickly. Management experience, assessment

method, there are many tools for overcoming the

crisis. Some fragmentation occurs - people are in

bubbles, as if isolated from each other.

Alexey Bazhenov offers creative industries to

transfer their OKVEDs to the category of victims as

much as possible. Thanks to the crisis, a third world

war did not happen: it allows society to restructure.

During the crisis, those trends that were fading away

began to develop more successfully (for example, the

fashion industry).

In this situation, there is a common enemy: danger

to life, in fact it is a threat.

Why can COVID-19 help? Contemporary art is

loaded with ethical meanings, for example, Fashion

Industry - you buy not a thing, but a brand! The

Russian fashion industry enters with a deformed

market, but there are all the elements to work with.

In addition to threats, the crisis also provides

opportunities:

 intersectoral links;

 interdisciplinary projects;

 modeling teamwork;

 breakthrough innovation;

 business literacy (many online seminars);

 techno parks (as an example, the creation of a

factory in Ulyanovsk with a brand, the appearance

of a name, a story, filming, designers);

 creation of an anti-crisis headquarters (cost

reduction);

 change of OKVED;

 banking instruments.

Situations such as COVID 19 can be repeated and

the main support must come from within the

community, and the state must give support.

In creative industries, it's important to interact

with each other. People need to think: What can I

offer for the market? Consider what people need.

At this stage, a film almanac is being created -

how everyone sees the future in the fashion industry.

The fifth technological revolution is taking place:

supervising capitalism, for example in London - 1000

video cameras, increased state control in the sphere of

security.

A more cohesive structure of creative industries in

China based on blockchain, which mitigates much of

the negative impact of the crisis. This is the time when

you yourself need to make the future!

Australia has a clear separation of the creative

industries (film, IT, etc.) from the cultural industries

(theater, museums, etc.). There is an anti-crisis

approach; there are no real instruments yet.

The pandemic will completely change the

performance of the creative industries (Fig. 2).

In conditions of self-isolation in the creative sphere,

people:

 online projects are launched, content is being

made (new technologies are being mastered);

 an opportunity to earn money is being sought

(crowd funding, fundraising, digital content

monetization);

 an opportunity to earn money is being sought

(crowd funding, fundraising, digital content

monetization);

 trying to organize themselves.

This raises the question: "Why are certain sectors

of the creative industries strong in specific regions

and what is required to support their development?"

An understanding is required to develop effective

tools in the creative field, on the one hand, of the key

and specific components of human capital, and, on

the other, of those conditions and mechanisms that

will make it possible to effectively implement these

components in practice. Otherwise, the growth of

“non-capitalized” human potential is inevitable -

people with a set of useful skills that are not fully

included in the economy, since they do not find a

place for themselves in the labor market or do not

have those competencies that would give

significantly greater returns, as personal, and for

society as a whole (Castells, 2000).

Problems of Socio-economic Crisis Caused by Covid-19 Inﬂuence on Creative Industries

199

Figure 2: Opportunities and threats of the crisis in the creative industries.

Table 1: Transformations in the main areas of creative industries due to the coronavirus pandemic.

Name of the sphere of

creative industries

Transformations

Theater industry

- online

roadcasts of

erformances;

- application of new forms in digital;

- exploration of creative reality;

- rehearsals online.

Literature / Publishers

- independent

ublishers an

ookstores suffe

losses; - stores go online;

- publishers are looking for new forms of interaction with the audience;

- writers play Decameron;

oetr

marathons are hel

online.

Music industry

- musicians go online;

- concert sites need support;

- the organizers of the concerts incur losses;

- Launche

the Stay

latform fo

organizing online concerts.

Film industry

- series on Instagram TV an

othe

web-formats;

- underground shooting;

- film festivals go online;

- offline cinemas are closed, online cinemas are gaining new audiences.

Galleries, art clusters and

museums

- media

rojects;

- loyalty programs;

- open calls.

The dynamics of changes in capital flows,

information, technology, organizational interaction,

images, sounds and symbols (Norcliff and Rendalce,

2003) turned out to be a consequence of the

restructuring of capitalism in the concept of creative

industries. The development of new technologies,

thanks to which the possibilities of cinema, television,

sound recording, and also a separate layer of

industrial archeology arose, provided the material

basis for the functioning of many creative industries,

and the aestheticization of the material sphere created

a demand for design (Creative industries, 2012).

M. Castells outlined the role of digital industries

in the general classification of creative industries,

when "the source of productivity lies in the

technology of knowledge generation, information

processing and symbolic communication" (Norcliff

and Rendalce, 2003).

Papushina Yulia, Ph.D., Associate Professor at

the Department of General Management, National

Research University Higher School of Economics

gives an example of the impact of digitalization on

the creative sphere, “a significant transformation of

comic book production that took place in the 1980s –

1990s due to a new generation of microprocessors,

the increasing power of small computers, electronic

communications and ways of transmitting data via the

Internet (Bell, 1999).

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Figure 3: Evolution of views of foreign and domestic scientists on the economy.

Let us consider the evolution of the views of

foreign and domestic scientists on the creative

economy, which is shown in Fig. 3.

The discussion of the results. As a result of the

analysis, we can conclude about the impact of the

coronavirus pandemic on the creative industries, this

sector of the economy is undergoing significant

transformations (Table 1).

Thus, it is necessary to use information

technology as a strategic position for development in

the field of creative industries. In addition, it must be

remembered that, as far as possible, some types of

industry can support other types, interacting with

each other.

In most cases, the most important and promising

external indicator for entrepreneurship in the field of

Information economy

(Informational means of

production -

information)

Knowledge economy

(cognitive means of

production - knowledge

and human capital)

Creative economy

(divergent means of

production - ideas

J. Hawkins Creativity is an economic activity, its result - the idea has economic

application and the final product (Florida, 2005).

R. Florida Creativity Becomes a Driver of Economic Growth (Inozemtsev, 2000).

Domestic scientists: Inozemtsev V.L., Stepanov A.A., Zhuravlev V.A., Barkhatov

I.D., Dyachenko O.V., Zelentsova E.V. (Barkhatov Dyachenko, 2014), (Zelentsova,

2008), (Glushkova, 2019).

Leading countries: Great Britain, Australia, Germany, Canada, Denmark, Finland

E. Toffler knowledge - knowledge turns into "informational and symbolic capital",

acting as a real useful force, a means of achieving social and economic results, both

by an individual and by society as a whole (Masuda, 1998)

E. Masuda formation of a “new environment” of people's life, “computer-top lists”;

“It will be a society of harmony, with a small government and state apparatus

(Abdeev, 1994)

Domestic scientists: R.S. Abdeev, A.I. Anchishkin D. Blumenau, V.A. Vinogradov,

V.N. Glushkov (Anchishkin, 1989), (Vinogradov, 1989), (Machlup, 1966) Leading

countries: United States, West Europe and Japan

Fritz Machlup the knowledge economy is the part of the economy that participates

in the production and dissemination of knowledge (Blumenau, 1982)

Enzo Rullani cognitive capitalism - the stage of mutation where capital fuses with

knowledge

Domestic scientists: R.S. Abdeev, A.I. Anchishkin D. Blumenau, S. Yu. Glazyev,

V.N. Glushkov, (Glazyev, 1993; Glushkov and Kanygin, 1982; Howkins, 2013) etc.

Leading countries: United States, Germany, United Kingdom, Korea and Japan

Infected economy

(COVID19)

J. Hawkins Creativity is an economic activity, its result - the idea has economic

application and the final product.

R. Florida Creativity Becomes the Driving Force of Economic Growth.

Domestic scientists: Inozemtsev V.L., Stepanov A.A., Zhuravlev V.A., Barkhatov

I.D., Dyachenko O.V., Zelentsova E.V., etc.

Leading countries: Great Britain, Australia, Germany, Canada, Denmark, Finland

Post-industrial

economy

А.A. Coomaraswamy, rejection of industrialization in favor of more primitive

economic systems.

D. Bell the transition from the production of goods to the expansion of services,

research (Rumyantsev, 1980).

Domestic scientists: Rumyantsev, Kozlov, Mileikovsky, 1982).

Leading countries: United States, Germany, United Kingdom, Korea and Japan

Problems of Socio-economic Crisis Caused by Covid-19 Inﬂuence on Creative Industries

201

creative industries is the "potential for further

development". It can be explained, interpreted in

terms of the technology life cycle or S-curve, which

is denoted as an efficiency curve (Bell, 1999).

It is necessary to apply new technologies in the

creative sphere to obtain a high result in comparison

with old technologies in a crisis. At the same time, we

note that the results of the use of obsolete

technologies are approaching the saturation limit and

are characterized by declining productivity of

research and development. This explains the need for

early recognition of technology changes and their

implementation in accordance with the requirements

of the Strategy for Innovative Development of the

Russian Federation for the period up to 2020

(www.economy.gov.ru).

It should also be borne in mind that when applying

technologies, first of all, one should evaluate the

creative cluster; its potential and further development.

3 CONCLUSIONS

The main task in the creative sphere in the context of

a pandemic under the influence of various factors of

the external and internal environment is to ensure the

improvement of existing processes, the timely

transformation of creative industries using

information technology, the transition to online areas

of interaction with consumers, the development and

support of creative class stake holders (small and

micro-enterprises of the creative spheres, self-

employed), state support for creative industries most

affected by the crisis.

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