The Economic Impact of Hawai i Museums and Cultural Attractions in a Tourism Economy

Transcription

1 The Economic Impact of Hawai i Museums and Cultural Attractions in a Tourism Economy Juanita C. Liu, Professor School of Travel Industry Management, University of Hawai i Occasional Paper , March 2006 This product is part of the School of Travel Industry Management (TIM) Occasional Paper Series. TIM Occasional Papers are intended to share researchers latest findings and to solicit informal peer review. These papers are circulated by the School of TIM, but do not go through a formal editing or peer review process. Unless otherwise indicated, occasional papers can be quoted and cited without permission of the author, provided the source is fully cited and clearly referred to as an occasional paper. Copyright is retained by the author(s) of the occasional paper.

2 ACKNOWLEDGMENTS: This study was prepared for the Hawai`i Museums Association through a grant from the Professional Services Program of the Institute of Museum and Library Services, a federal agency serving the nation's museums. Grateful acknowledgments are made for support of this study from George Ellis, President of the Hawai`i Museums Association (HMA), the HMA Board of Directors, the HMA Marketing Committee and the UH School of Travel Industry Management (TIM). Special mention goes to Deborah Pope, Project Director for the HMA, for initiating the project and for assistance in data collection. Dr. George Ikeda, Research Director at the School of TIM, facilitated the project and David Qi provided computer assistance. Dr. Eugene Tian of the Econometric Research Branch of the Department of Business, Economic Development & Tourism (DBEDT) graciously provided helpful advice and assistance with the state input-output model. Attendance data were provided by the Business Resource Center at DBEDT and by Gary Barbano of the National Park Service. Helpful comments were received from Dean Chuck Y. Gee of the TIM School, Dr. Pearl Imada Iboshi, Economic Research Administrator at DBEDT, and Dr. Gregory Pai, Special Assistant to the Governor. Above all, this study would not have been made possible without the enormous contribution of the museum administrators and staff who were willing to complete the extensive survey questionnaire. To all the above and others who supported this study -- a warm and sincere mahalo. LIST OF PARTICIPANTS - HAWAI`I MUSEUM COMMUNITY Alexander & Baldwin Sugar Museum Amy B. H. Greenwell Ethnobotanical Garden Astronaut Ellison S. Onizuka Space Center Bailey House Museum (Maui Historical Society) Bernice P. Bishop Museum Children's Discovery Center Cultural Learning Center at Ka`ala Damien Museum and Archives Fuku-Bonsai Center Grove Farm Homestead Hale Waiwai O Hana (Hana Cultural Center) Harold L. Lyon Arboretum Hawai`i Nature Center Hawai`i Tropical Botanical Garden Hawaiian Historical Society 1

3 Hawaiian Railway Society Ho`omaluhia Botanical Garden Honolulu Academy of Arts Honolulu Zoo Hui No`eau Visual Arts Center `Iolani Palace State Monument Japanese Cultural Center Judiciary History Center Kaua`i Children's Discovery Museum Kaua`i Historical Society Museum Kaua`i Museum Koke'e Natural History Museum Lahaina Restoration Foundation Lyman House Memorial Museum Maui Community Arts and Cultural Center Maui Military Museum Maui Okinawa Cultural Center Mission Houses Museum Moanalua Gardens Foundation National Tropical Botanical Garden Pacific Aerospace Museum Pacific Tsunami Museum Pu'uhonua O Honaunau National Historical Park Queen Emma Summer Palace The Contemporary Museum U.S. Army Museum in Hawai`i/Tropic Lightning Museum U.S.S. Arizona Memorial Museum U.S.S. Bowfin Submarine Museum & Park Volcano Arts Center Waikiki Aquarium Waipahu Cultural Garden Park (Hawai`i Plantation Village) ABSTRACT This purpose of this study is to estimate the economic impact of museums and other cultural attractions in terms of income and employment generation. Additional information on attendance, museum programs, marketing and promotional efforts, and ranking of strategies for future viability were solicited in order to examine linkages with the visitor industry. While previous museum studies examined the educational contributions to the community, the 2

4 focus of the Hawai`i study was to ascertain the contribution and potential of museums with respect to cultural tourism. In December 1996 questionnaires were mailed to 79 members of the Hawai`i Museums Association (HMA), resulting in 46 usable questionnaires. The data were weighted so that overall estimates for the entire population of 94 museums and other cultural attractions could be made. The Hawai`i state economic input-output model was used to estimate economic impacts. The results show that the 94 museums and cultural attractions generated total economic impacts of $339.4 million in output, 5,163 jobs (3,388 jobs in full-time equivalents), and $142.5 in total labor income in The direct effect consisted of $154 million in operating revenues, 3,302 jobs (2,168 jobs in full-time equivalents), and $75 million in total labor income in About 30 percent of total museum revenues were received from out-of-state sources. In addition, earned income generated through admission, program and membership fees, gift shop sales, concession sales, investment income, facility rentals, and other sales and services, provided 54 percent of the total museum community revenues. Another 27 percent was obtained through individual and institutional contributions. Government, including federal, state, and county, provided the remaining 19 percent of museum funds. The study results indicated that the average cost per visit to museums was about $ However, paid attendance comprises only 37 percent of total visitations to Hawai`i s museums. This means that museums are a tremendous bargain, since almost two-thirds of museum visitations are free of charge. Finally, the study explored how museums can benefit from building links with the visitor industry in promoting cultural tourism. Keywords: Cultural tourism, museum study, cultural attractions, economic impact and national parks. 3

5 INTRODUCTION There are approximately 94 museums and cultural attractions in the State of Hawai`i, consisting of museums, art galleries, historical sites, nature centers, and cultural centers. These places provide valuable educational and recreational opportunities for both residents and tourists through a great variety of programs and exhibits. School group visitations are also a valuable component for educational programs within the school system. Further, some establishments are increasingly becoming community meeting places through offerings of concerts and other forms of entertainment and hence, serve a social function within the community. Another important role that museums play is through the interpretation of local culture to tourists. For the International Council of Museums (ICOM), a museum is defined as a nonprofit making, permanent institution in the service of society and of its development, and open to the public, which acquires, conserves, researches, communicates, and exhibits, for purposes of study, education and enjoyment, material evidence of man and his environment. Unfortunately, no matter how worthy or noble the purpose, public funding is being increasingly scrutinized during these tight budget times. It is becoming more difficult to justify government support for traditionally supported enterprises when their economic contributions are not known. However, with the downturn in Hawai`i tourism and upswing in interest in culture by major tourist markets, museums and cultural places have the potential for playing an increasingly important role in promoting tourism, as well as extending tourists length of stay. With these objectives in mind, the purpose of this study is to determine the economic impact of museums and other cultural attractions in terms of income and employment generation. Additional information on attendance, museum programs, marketing and promotional efforts, and ranking of strategies for future viability were solicited in order to examine linkages with the visitor industry. It is hoped that the results will provide useful information on the magnitude and significance of the museum community in relation to state efforts to promote cultural tourism. 4

6 THE SAMPLE SURVEY The survey instrument used in the 1995 Utah museum study was used as a guide for this study so that comparisons can be made. However, the focus of the Utah study was the educational contribution of museums to the community, while the focus of the Hawai`i study is the contribution and potential of museums with respect to cultural tourism. In December 1996 the questionnaire was sent to 79 museums and other cultural attractions, mostly members of the Hawai`i Museums Association (HMA). Fifty responses were received, which is a more than 60 percent response rate. This high percentage response rate was due to the promotion of the study and follow-up by the HMA to its membership in its literature and at conferences. Because detailed financial and employment data were required, it was necessary to personally contact over half of the respondents. Several questionnaires were discarded due to insufficient responses, resulting in 46 usable questionnaires. Distribution by museum type can be seen in Appendix 1. The data were weighted so that overall estimates for the entire population of 94 museums and other cultural attractions could be made. The 1987 Hawai`i State economic input-output model was used to estimate economic impacts. METHODOLOGY Economic multipliers are generally categorized as output, employment, and income multipliers. Output multipliers show the volume of economic activity per dollar of additional final demand, such as tourist spending on museum services. Likewise, employment multipliers show the number of jobs per dollar of additional final demand. The income multipliers used in this study are commonly called income coefficients since they show the additional income per dollar of export sales. Direct income is that generated by the establishments that receive the tourist dollar. Indirect income is that generated through the interindustry purchases of goods and services. Income can also be induced by income flowing through households through wages and salaries and back into the economy. This induced flow is in proportion to the total income attributable to additional sales. When these various income coefficients are added, the total reflect the importance of an industry to households in the economy. 5

7 The Hawai`i Interindustry Model depends on five sets of data, including the national input-output model, survey-based data for purchases and sales of selected industries in Hawai`i, national price indices, estimates of gross sales and purchases for Hawai`i industries, and Gross State Product accounts for Hawai`i. The procedures were evolved from a set of techniques used in estimating regional transactions from the national input-output table. A detailed description of the model and procedures can be found in the 1972 publication entitled Interindustry Study of the Hawaiian Economy, by the Research and Economic Analysis Division of the State of Hawai`i Department of Planning and Economic Development. RESULTS AND FINDINGS HAWAI`I'S 94 MUSEUMS AND OTHER CULTURAL ATTRACTIONS HAVE TREMENDOUS OUTREACH. Hawai`i's 94 museums and cultural attractions currently have an annual attendance of approximately 20.1 million visitations. (See Appendices 1 and 2) National parks and other federal attractions capture the lion's share of attendance at 12.3 million, or 61 percent of total visitations. (See Table 1) However, the state s 65 private museums, art galleries, historical, natural, and cultural centers receive 5.6 million visits, or about 4.7 times Hawai`i's population. The figures in the 1989 National Museum Study conducted by the American Association of Museums (AAM) published in Museums Count may be outdated, however, they provide a basis for comparison with national norms. For example, the average of 4.7 visits to museums per person per year in Hawai`i is about double that of the AAM finding that on average, every American made 2.3 visits per person per year in On average, each Hawai`i museum receives 85,836 visitations per year, which is comparable to the 1988 national figure of 82,683 visits per museum. 6

8 TABLE 1. DISTRIBUTION OF MUSEUMS AND OTHER CULTURAL ATTRACTIONS Type Number Attendance Percent (millions) Museums, Galleries, Arboretums 65 5, National Park Attractions¹ 8 5, Other Federal 5 6, State Park Attractions² 7 1,174 6 County 9 1,066 5 Total 94 20, ¹Attendance only includes visitations to park centers, not total park attendance. ²Total attendance at all state parks is approximately 15 million. About half of the state's museums and other cultural attractions, along with two-thirds of the attendance, occur on Oahu. (See Table 2) The most frequented places are Punchbowl Cemetery, Kilauea Visitor Center, Jaggar Museum, U.S.S. Arizona Memorial Museum, Polynesian Cultural Center, Haleakala National Park, Honolulu Zoo, Sea Life Park, Whalers Village Museum, City of Refuge, Bishop Museum, Waimea Falls Park, Waikiki Aquarium, Lapakahi State Historical Park, Maui Tropical Plantation, and Honolulu Academy of Arts. This illustrates the tremendous diversity of the major cultural attractions. TABLE 2. ATTENDANCE AT MUSEUMS AND OTHER CULTURAL ATTRACTIONS BY ISLAND Island Number Attendance Percent (1,000s) Oahu 45 12, Big Island Maui 14 2, Kauai Molokai Total

9 MUSEUMS AND OTHER CULTURAL ATTRACTIONS REPRESENT A VITAL PART OF HAWAI`I'S ECONOMY. Table 3 shows that the 94 museums and other cultural attractions directly generated $154 million in operating revenues, 3,302 jobs (2,168 jobs in full-time equivalents), and $75 million in total labor income in Moreover, employee costs, including fringe benefits account for almost half of the total budget, indicating a highly wage-intensive industry. This is comparable to the AAM study that found that personnel expenses account for 54 percent of operating budget in Appendices 3 and 4 show the estimation and weighting procedures used to obtain the total results for the Hawai`i study. The total economic impact of the museum and cultural attractions sector can be calculated by using the state input-output model in a manner that is consistent with DBEDT procedures. The results show that the 94 museums and cultural attractions generated total, including direct, indirect, and induced, impacts of $339.4 million in output, 5,163 jobs (3,388 jobs in full-time equivalents), and $142.5 in total labor income in (See Table 4a) TABLE 3. PROFILE OF HAWAI`I MUSEUMS AND OTHER CULTURAL ATTRACTIONS Number of Establishments 94 Total Annual Revenues $153,563,800 Mean Annual Revenues $1,633,657 Percentage of Total Revenues from Sources Outside Hawai`i 29.7 Total Paid Employment 3,302 Total Paid Employment in Full-time Equivalents (FTE) 2,168 Full-time Employment 1,900 Part-time Employment Expressed in Full-time Equivalents 268 Total Part-time Employment 1,402 Total Labor Income 74,809,492 Total Wages & Salaries $59,294,492 Fringe Benefits $15,514,574 Average Earnings Per Full-time Employee $34,506 8

10 Total Attendance 20,129,831 Economic Impact on Hawai`i Economic Output $339,400,000 Economic Impact on Hawai`i Household Income $142,527,00 Economic Impact on Employment 5,163 Note: Results weighted to estimate total population. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. MUSEUMS AND OTHER CULTURAL ATTRACTIONS CREATE INCOME AND JOBS IN HAWAI`I'S ECONOMY THROUGH EXTERNAL FUNDS. The survey results indicate that about 30 percent of total museum revenues are received from out-of-state sources. Interestingly, this is the same percentage found in the Utah study. Hence, in 1996 $46.2 million in external funds received by museums created $101.4 million in economic output in the Hawai`i economy, $43 million in local household income, and 1,542 jobs (1,014 in full-time equivalents). (See Table 4b) External funds include tourist spending on admissions fees and purchases, federal funds, and contributions from out-of-state organizations and individuals. These funds are desirable since their economic contributions represent a pure increase to the economy. By contrast, a new local business may have the substitution effect of taking away revenues and jobs from existing businesses. In this study only the economic impact of the operations of museums and cultural attractions are accounted for. If the impact of spending by visitors attracted by these museums and cultural attractions were included, the economic impact would be substantially greater. For example, a visit to the Volcanoes National Park may be the key reason for a visit to the Big Island. If so, then visitor expenditures on accommodations, food, transportation, and other purchases, could be included. A recent year-long study by the Travel Industry Association of America based on interviews with 240,000 Americans found that historical and cultural travelers spend more than the average U.S. traveler -- $615 per trip compared to $425 and stay more than a day longer. The study also found that Hawaii ranks second only to the nation s capital for the share of its domestic visitors who take in a historical or cultural activity. More than half of the travelers to Hawai`i percent -- took advantage of the Islands history and culture during their visit, compared to 61 percent of the travelers to Washington, D.C. 9

11 Tables 4a and 4b show the multiplier results for output, employment, and household income for the museum sector. As can be seen, Type I and Type II multipliers for output are 1.51 and 2.20, while Type I and Type II multipliers for employment are 1.23 and 1.56, respectively. Total income multipliers, which calculate local income contributions per dollar of out-of-state museum receipts, are.93, which is relatively high due to the high wage ratio. More detail on the industry by industry contributions from museums and other cultural attractions to output, employment, and local income can be seen in Appendix 5. TABLE 4a. MUSEUM SECTOR IMPACT AND MULTIPLIERS Output Employment (full-time & part-time) Household Income (mil. $) Multiplier Number Multiplier (mil.$) Multiplier Direct , Direct + Indirect 233,078 Type I Type I , Direct + Indirect + Induced 339,400 Type II Type II , Note: Derived from the Hawai`i State Input-Output model, based on survey research. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. TABLE 4b. MUSEUM SECTOR IMPACT AND MULTIPLIERS FOR EXTERNAL FUNDS Output Employment (full-time & part-time) Household Income (mil. $) Multiplier Number Multiplier (mil. $) Multiplier Direct Direct + Indirect Type I ,219 Type I Direct + Indirect + Induced 101,379 Type II ,542 Type II Note: Derived from the Hawai`i State Input-Output model, based on survey research. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. 10

12 MUSEUMS ARE PRIMARILY SELF-SUPPORTING, ALTHOUGH GOVERNMENT SUPPORT IS CRITICAL FOR SURVIVAL. Table 5 shows that earned income provides 54 percent of the total museum community revenues. Earned income is generated through admission, program and membership fees, gift shop sales, concession sales, investment income, facility rentals, and other sales and services. Another 27 percent are obtained through individual and institutional contributions. Government, including federal, state, and county, provides the remaining 19 percent of museum funds. The largest source of museum revenues is through admissions, program and membership fees at about one-fourth of the total. The second largest source of funds is through individual donations and contributions at 15 percent. Sales of goods and services is the third largest source of funds at 11.3 percent. Further disaggregation of museum community funding sources can be seen in Appendices 6 and 7. Financially, Hawai`i's museums compare very favorably with Utah's museums which has the following distribution of income percent from earned income, 35 percent from contributions and 31 percent from government funds. (See Table 6) Moreover, the 1996 median revenue of $536,261 for the Hawai`i museum sample was 3.3 times higher than the 1995 median revenue for the Utah sample. According to the AAM study, Hawai`i also does better compared to the national breakdown obtained in 1988 in terms of having higher proportions of earned and contributed income categories. National median operating income in 1988 was reported by the AAM as $86,656. TABLE 5. MUSEUM FUNDING BY SOURCE, 1996 (n=46) Source Amount Percent of Cumulative Budget Percentage Admissions, Program, & Membership Fees $16,001, Individual Donations/Contributions 9,915, Sales of Goods & Services 7,464, Investment Income, Endowments/ Rentals 5,943, Sales of Assets, Commissions 5,933,

13 Private Foundation Grants/Trusts 5,889, Federal Grants/Awards 5,542, State Support 4,513, County Support 2,539, Corporate Support 1,610, Non-profit Support Group 292, Parent Organizations 158, Other Contributions 32, Total 65,836, Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. TABLE 6. COMPARISON OF MUSEUM BUDGET SOURCES HAWAI`I, 1996 UTAH, 1995 NATION, 1988 Earned Income 54 percent 34 percent 42 percent Contributed Income Government Funds Total MUSEUMS ARE A BARGAIN FOR ITS VISITORS AND TOURISTS ARE AN IMPORTANT PAYING CONSTITUENCY. Study results indicate that the average cost per visit to museums is about $ (see Table 7) According to the survey, 59 percent of the respondents charge admissions, while 85 percent charge admissions, program, or membership fees. (The percent of museums that charge admissions is slightly higher than the 55 percent reported by the AAM in 1989.) However, paid attendance comprises only 37 percent of total visitations to Hawai`i s museums. This means that museums are a tremendous bargain, since almost two-thirds of museum visitations are free of charge. In addition, school group attendance represents 7.3 percent of total attendance. For those who paid admissions, program, or membership fees, the average cost per visit was $7.50. The 1992 HMA survey 12

14 showed that 91 percent of tourists rated museum admission prices as being good or excellent. Furthermore, out-ofstate visitors account for 58 percent of paid attendance. TABLE 7 HAWAI`I MUSEUM COMMUNITY PROFILE, 1996 (N = 46) Number of Museums 46 Non-profit organizations 38 For-profit organizations 1 Governmental organizations 7 Total Operating Revenues $65,836,546 Mean Operating Revenues $1,431,229 Median Operating Revenues $536,261 Revenues From Sources Outside Hawai`I $19,556,526 Percent of Total Revenues From Sources Outside Hawai`I 29.7 Average Annual Marketing Costs (n = 28) $33,702 Total Employment 1,465 Total Paid Employment in Full-time Equivalents (FTE) 953 Full-time Employment 834 Part-time Employment Expressed in FTEs 119 Total Part-time Employment 631 Total Labor Income $31,938,401 Total Wages & Salaries $25,346,766 Fringe Benefits $6,591,635 Average Earnings Per Full-time Employee $33,514 Number of Volunteers 7,498 Number of Volunteer Hours 391,272 Estimated Value of Volunteer Time in Dollars $3,164,114 Total Attendance 5,721,372 Total Paid Attendance 2,136,677 No. of Paid Attendance by Non-Hawai`i Residents 1,247,466 Percent of Paid Attendance by Non-Hawai`i Residents 58.4 Total School Group Attendance 418,119 Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. MUSEUMS PROVIDE MANY FULL-TIME AND PART-TIME JOBS, AS WELL AS OPPORTUNITIES FOR VOLUNTEERS. Part-time employment accounts for 54 percent of the total, higher than the national average of 40 percent reported by the American Association of Museums, but smaller than the 62 percent found in the Utah study. However, when part-time jobs are converted into full-time equivalents, full-time jobs comprise 88 percent of the 13

15 total. (See Table 8) The number of volunteers is extraordinary at 6.4 times the total paid staff. In comparison, the 1989 AAM study found that for every paid staff member, there were only 2.5 volunteers. On the other hand, the value of volunteer labor constitutes only 10 percent of total employee costs in the Hawai`i survey. This indicates that although there are many opportunities for part-time employment and volunteers, the industry is predominantly run by full-time employees, with average earnings per employee at $34,506, including 21 percent of the total for fringe benefits. Table 8 illustrates the employment distribution in the Hawai`i museum community. The overall average is 21 employees in full-time equivalents per establishment. On average, this includes 18 full-time and 14 total parttime employees. By contrast, the 1989 AAM study found that museums at that time employed an average of 11 fulltime and 7 part-time employees. The Hawai`i survey found that employment in the industry is concentrated in the larger institutions, since those with at least 21 employees provided 73 percent of total full-time employment. These larger establishments on average employ 58 full-time workers, 5 part-time workers, and 208 volunteers. TABLE 8. EMPLOYMENT DISTRIBUTION OF HAWAI`I MUSEUM COMMUNITY, 1996 (N = 46) Category of Total Employment in FTE Number of Institutions Total Employment in FTE Full-time Employment Part-time Employment in FTE Total Part-time Employment Volunteers All Volunteer employees employees , employees employees , or more ,292 employees Total ,498 Note: FTE means full-time equivalent. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. 14

16 MUSEUMS CAN BENEFIT FROM BUILDING ON THEIR LINKS WITH THE VISITOR INDUSTRY IN PROMOTING CULTURAL TOURISM. Table 9 shows how the Hawai`i museum community ranked 15 strategies for increasing their future viability, while the distribution of responses can be seen in Appendix 8. Seven key priorities can be identified and are consistent with results from the HMA study of museum visitors in 1992, which surveyed 1,781 tourists and 893 residents at 16 sites. Priorities ranked as extremely important: Priority 1. Increase community support and visibility. In the 1992 HMA visitor study, three out of five visitors had not planned to visit the museum prior to arrival, suggesting that measures to increase visibility would help to attract tourists, as well as residents. It was found that tourists were most likely to find out about the site through a guidebook (30%), word of mouth (26%), or by road signs or maps (15%). Priority 2. Increase income producing activities and aggressive marketing. The HMA study reported that there was a tendency for institutions that were not visited by tourists who were on their first trip, to be visited on subsequent trips. This demonstrates the potential of museums in attracting the repeat visitor market, especially to the neighbor islands. In the 1996 study, 28 museums reported marketing costs that averaged $33,702, or 2.4 percent of average revenues of $1,431,229. (See Table 7) However, 98 percent of the Hawai`i museum community have some form of paid advertising in visitor publications (39%), newspapers (26%), radio (26%), magazines (24%), and TV (11%). However, the most utilized forms of promotion are public service announcements and press releases in newspapers (87%), visitor publications (76%), radio (76%), magazines (67%), and TV (67%). Other popular forms of promotion are promotional brochures (65%), merchandise (59%) and etc. Thirty-five percent of respondents have WEB-sites. (See Table 10) 15

17 Priorities ranked as very important: Priority 3. Improve staff development and interpretation. According to the HMA study, seventy-eight percent of tourists spent between a half-hour and two hours at the museum. Education/entertainment was the most cited reason for visiting the site (40%). Another 26 percent said that education alone was the primary reason for visiting. Exhibits were rated good to excellent by 98 percent of tourists, while museum staff hospitality was rated good or excellent by 99 percent. The 1996 study indicates that 57 percent of museums have interpreters and docents on station. Hence, museums staff are doing a fine job and this should continue to be a priority. Priority 4. Attract more tourists and develop links with the visitor industry. The HMA study showed that Hawai`i's museums are attracting and satisfying the high education and high income tourists who are vital to the state's economy. In the HMA study the average museum visitor is welleducated, well employed, in early middle age, and accompanied by a spouse and other family members. In addition, tourists gave Hawai`i museums extremely high marks in all aspects. An exceptionally high 99 and 98 percent of tourists rated Hawai`i museums as good to excellent in overall quality and fulfillment of expectations, respectively. Further, 92 percent of tourists said they would return for another visit. In 1996, 58 percent of museums reported that they are members of at least one visitor industry association, with nearly half belonging to the Hawai`i Visitors and Convention Bureau. (See Table 11) Priority 5. Provide more cultural programs. The HMA study suggested that sites having to do with the monarchy and missionaries are of particular interest to nonresidents. The results also showed that 25 percent of tourists sought a Hawaiian experience, compared to only 5 percent of residents. 16

18 Priority 6. Increase government support and improve transportation. The HMA survey showed that location and ease of access are critical to tourists visits. Most walked (35%) or drove a rental car (28%), while a large number (21%) took The Bus. Many museums benefit from proximity to tourist attractions and accommodations. Priorities ranked as important: Priority 7. Provide more programs with higher entertainment value. The HMA study showed that about 50 percent of tourists chose entertainment as a primary reason for their visit (education/entertainment - 40%, entertainment - 10%). Entertainment was also important for fifty-three percent of residents (education/entertainment - 39%, entertainment - 14%). These results underscore the important value of entertainment for both visitors and residents. Table 12 shows that museums provides a variety of education/entertainment programs, including special events (67%), video/film (61%), work or craft demonstrations (41%), and performances/concerts (37%). Fifteen percent of museums surveyed have living history programs. TABLE 9. RANKING OF STRATEGIES FOR INCREASING FUTURE VIABILITY OF THE HAWAI`I MUSEUM COMMUNITY, 1996 (N = 46) Strategies Mean Extremely important Increase community support More visibility/improve public image Increase attendance by local residents More income producing activities 4.05 Very important

19 5. More aggressive marketing efforts Improve staff development Increase attendance by out-of-state visitors Improve preservation/interpretation Joint advertising with industry associations Increase links with cultural tourism More Hawaiian culture programs More programs on Hawai`i s multi-cultural environment Increase government support Improve transporting visitors to site 3.07 Important Programs with higher entertainment value 2.59 Note: 1 = not important; 2 = somewhat important; 3 = important; 4 = very important; and 5 = extremely important. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. TABLE 10. HAWAI`I MUSEUM COMMUNITY MARKETING AND PROMOTIONS, 1996 (N = 46) Type Number Percentage (%) Paid Advertising Visitor Publications Newspapers Radio Magazines TV Other ¹ Public Service Announcements/Press Releases Newspapers Visitor Publications

20 Radio Magazines TV Other ² Other Promotions Promotional Brochures Merchandise (posters, calendars, t-shirts, mugs, etc.) Discount Coupons Calendar of Events Program Collaboration/Joint Programs WEB-site Kama`aina Discounts Contract With Brochure Distributor Program Packages With Commercial Tour Operators Promotional Video Group Ticketing With Other Organizations Other ³ ¹ Includes telephone book ads. ² Includes tour guide publications, speakers bureau, Chambers of Commerce, rotary clubs, mailings to membership or target groups. ³ Includes newsletters. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. 19

21 TABLE 11 HAWAI`I MUSEUM MEMBERSHIP IN VISITOR INDUSTRY ASSOCIATIONS, 1996 (N = 46) Type of Organization Number of Institutions Hawai`i Visitors & Convention Bureau 21 O`ahu Attractions Association 5 Waikiki - O`ahu Visitors Association 2 Other Marketing/Promotional Groups ¹ 15 ¹ Includes Chambers of Commerce, Destination Hilo, Hilo Downtown Improvement Association, cultural organizations working with DBEDT to establish a cultural tourism project, etc. Note: Fifty-eight percent of the Hawai`i museum community belong to at least one visitor industry association. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. TABLE 12. HAWAI`I MUSEUM PROGRAMS, 1996 (N = 46) Programs Number Percentage (%) Permanent Exhibits Guided Tours On-site School Programs Temporary or Rotating Exhibits Other Special Events Video/Film/Multi-Media Walking Tours Interpreters/Docents on Station Traveling Exhibits Teacher Training Workshops Work or Craft Demonstration Performances/Concerts Outreach School Programs

22 Living History Programs Other ¹ Includes hands-on workshops, lectures, conferences, lunch programs, curriculum guides for teachers, local TV history series, elderhostel classes, library, archives, and publications, etc. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. MUSEUMS ARE DEVELOPING PROGRAMS FOR OUT-OF-STATE VISITORS. Just as it is true that the tourist business is important for museums, it is also evident from the various studies that museums are an important component for the visitor industry. The satisfaction provided by museums and cultural attractions to visitors means that they will only increase the value of the tourism product in the future given current consumer trends. The following plans to attract more tourists were listed by 11 out of the 46 respondents in the survey. They are the 4 P s of museum strategies for cultural tourism. Programs Pairing up Promotion On-site demonstrations and lectures Special walking tours for Japanese visitors, including Japanese-speaking docents Elderhostel-like programs Special concert series for visitors Educational programs for mainland students Annual events for international visitors Joint programs and symposiums Cultural programs with local hotel or visitors bureau Extend promotional efforts with hotels and resorts Publishing guides, brochures, walking tours Increase international signage and visibility WEB-site Proposed Facilities and Operations Visitor center with gift shop 21

23 Opening 7 days a week or year-round Charging market rates CONCLUSIONS Museums and cultural attractions are a valuable and cost-effective community resource. The magnitude of revenues from museums is small in relation to the total economy, but museums and cultural attractions generate a respectable amount of income and employment to the local community. However, they are also a vital component of the visitor industry. Their importance can be seen in their tremendous popularity with visitors in providing a highly satisfying experience at bargain rates. Tourist attendance is substantial, and these visitors spend a lot of money in other sectors of the economy. This study found that although museum activities are partially funded by government, museums more than pay their way through earned and contributed income sources. They also create income and jobs in Hawai`i's economy, in addition to providing value for visitors. A few museums are planning new programs and efforts to attract tourists, but more needs to be done to further develop the links with cultural tourism. In addition, collaboration with the visitor industry has already been established, but needs to be strengthened and expanded. Given the results of this study, the prognosis for further collaboration is very positive as the potential for expanding into cultural tourism becomes increasingly recognized by the visitor industry as a viable means for product diversification. Ultimately, the outreach extended through cultural tourism can promote local culture to residents, as well as visitors. Finally, the entertainment value, along with education, must be appreciated in order to attract future visitors. Museums can become centers of living culture, through innovative programs and the open museum concept, and hopefully, serve the function of being cultural meeting places for residents and tourists. 22

24 BIBLIOGRAPHY The American Association of Museums, Museums Count, A Report by The American Association of Museums, Washington, D.C., Arts Council of Hawaii, The Economic Impact of Hawaii s Non-Profit Arts and Cultural Organizations 1982, A statewide study conducted June-October, Hawaii Museums Association and the Institute of Museums Services, Hawaii Museums Visitors Survey Project, Liu, Juanita C., Relative Economic Contributions of Visitor Groups in Hawai`i, Journal of Travel Research, Vol. 15, No. 1, Summer 1986, 2-9. State of Hawaii Department of Business, Economic Development & Tourism, The State of Hawaii Data Book 1995, A Statistical Abstract, State of Hawaii Department of Planning and Economic Development, Interindustry Study of the Hawaiian Economy, Research and Analysis Division, Utah Museums Association, Economic Impact of Utah Museums on the Local Economy, Prepared by the Bureau of Economic and Business Research, University of Utah David Eccles School of Business, APPENDIX 1 CLASSIFICATION OF HAWAI`I MUSEUM COMMUNITY, 1996 Nature of Organization Population Sample (n = 94) (n = 46) History Historic Site 22 9 Natural History/Nature Center 13 6 Arboretum/Botanical 14 5 Art 9 4 Children/Youth 2 2 Science/Technology

25 Cultural 7 2 Zoo 2 1 Aquarium 1 1 Natural History/Anthropology 1 1 Aquarium 2 0 Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. APPENDIX 2. ATTENDANCE AT MUSEUMS AND OTHER CULTURAL ATTRACTIONS Island and Institutions Attendance Year O`ahu 1 Bernice P. Bishop Museum 445, Children s Discovery Center (Hawai`i Children s Museum) 16, Cultural Learning Center at Ka`ala 3, Damien Museum and Archives 14, Foster Botanical Garden 65, Fred Ohrt Water Museum 6, Halawa Shaft 11, Halawa Xeriscape Garden 12, Harold L. Lyon Arboretum 30, Hawai`i Maritime Center 74, Hawai`i Nature Center 50, Hawai`i Okinawa Center n.a. 13 Hawaiian Historical Society 1, Hawaiian Railway Society 16, He`eia State Park n.a. 16 Ho`omaluhia Botanical Garden 159,

26 17 Honolulu Academy of Arts 302, Honolulu Zoo 661, `Iolani Palace State Monument 74, Japanese Cultural Center 5, Judiciary History Center 52, Mission Houses Museum+ 30, Moanalua Gardens Foundation 25, Mormon Temple Grounds 119, National Memorial Cemetery of the Pacific (Punchbowl) 6,281, Pacific Aerospace Museum 50, Pacific Whaling Museum n.a. 28 Polynesian Cultural Center 938, Queen s Medical Center Historical Room n.a. 30 Queen Emma Summer Palace 55, Sea Life Park Hawaii 596, Senator Fong s Plantation and Gardens 93, Tennent Art Foundation Gallery n.a. 34 The Contemporary Museum 27, The Honolulu Advertiser Gallery 20, Tropic Lightning Museum 10, U.S. Army Museum in Hawai`I 104, U.S.S. Arizona Memorial Museum 1,423, U.S.S. Bowfin Submarine Museum & Park 172, University of Hawai`i Art Gallery 50, Wahiawa Botanical Garden 14, Waikiki Aquarium 373, Waimea Falls Park 420,

27 44 Waipahu Cultural Garden Park (Hawai`i Plantation Village) 72, World Wildlife Museum 12, Hawai`i 46 Amy B. H. Greenwell Ethnobotanical Garden 4, Astronaut Ellison S. Onizuka Space Center 22, Fuku-Bonsai Center 3, Hawai`i Tropical Botanical Garden 57, Hulihe`e Palace 16, Kaloko-Honokohau National Historical Park 48, Kamuela Museum n.a. 53 Kealakekua Bay State Historical Park 218, Kilauea Visitor Center 2,490, Kona Historical Society (Greenwell Store Museum) 6, Lapakahi State Historical Park 336, Lyman House Memorial Museum 14, Nani Mau Gardens (Hilo) n.a. 59 Pacific Tsunami Museum 10, Panaewa Rainforest Zoo 75, Parker Ranch Historic Homes 14, Parker Ranch Visitor Center 14, Pu`uhonua O Honaunau National Historical Park 458, Pu`ukohola Heiau National Historic Site 188, Thomas A. Jaggar Museum 2,490, Volcano Art Center 250, Wailoa Center 38,

28 Maui 68 Alexander & Baldwin Suger Museum 29, Bailey House Museum (Maui Historical Society) 14, Hale Waiwai O Hana (Hana Cultural Center) 15, Haleakala National Park 1,582, Hawai`i Nature Center 11, Hui No`eau Visual Arts Center 30, Kula Botanical Gardens 23, Lahaina Restoration Foundation 208, Maui Community Arts & Cultural Center 200, Maui Military Museum n.a Maui Okinawa Cultural Center Maui Tropical Plantation 307, Maui Zoological & Botanical Gardens 60, Whalers Village Museum (Whale Center of the Pacific) 504, Kaua`i 82 Grove Farm Homestead 3, Ho`opulapula Haraguchi Rice Mill 1, Kaua`I Children s Discovery Museum 12, Kaua`I Historical Society Museum 2, Kaua`I Museum 23, Kilauea National Wildlife Refuge 80, Koke`e Natural History Museum 120, National Tropical Botanical Garden 16, Russian Fort Elizabeth State Historical Park 75, Wai`oli Mission House 1,

29 Sources: State of Hawai`i Data Book, National Park Service and survey results. Note: Attendance is based on latest available figures for each establishment. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. APPENDIX 3. HAWAI`I MUSEUM COMMUNITY PROFILE BY SUBGROUPS, 1996 Large Small Number of Museums 6 40 Non-profit organizations 3 35 For-profit organizations 0 1 Governmental organizations 3 4 Average Operating Revenues $5,856, ,452 Average Revenues From Sources Outside Hawai`i $1,748, ,569 Percent of Total Revenues From Outside Hawai`i Average Annual Marketing Cost $55,000 32,064 Ave. Paid Employment in Full-time Equivalents (FTE) Average Full-time Employment Average Part-time Employment Expressed in FTEs 7 2 Average Part-time Employment Average Labor Income $2,913, ,395 Average Wages & Salaries $2,294, ,426 Average Fringe Benefits $618,812 71,969 Average Earnings Per Full-time Employee $37,923 29,382 Average Number of Volunteers Average Number of Volunteer Hours 15,473 7,461 Average Estimated Value of Volunteer Time in Dollars $108,375 62,847 Average Attendance 610,879 51,438 Average Paid Attendance 175,491 26,075 28

30 Average Paid Attendance by Non-Hawai`I Residents 84,455 18,066 Percent of Paid Attendance by Non-Hawai`i Residents Average School Group Attendance 37,767 4,562 Note: Large establishments have attendance greater than 260,000 persons. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. APPENDIX 4. ESTIMATION OF MUSEUM AND CULTURAL ATTRACTIONS SECTOR, 1996 Large Small Total Number of Museums Total Operating Revenues $93,702,544 59,861, ,563,800 Mean Operating Revenues $5,856, ,452 1,633,657 Revenues From Sources Outside Hawai`I $27,983,376 17,672,382 45,655,758 Percent of Total Revenues From Sources Outside HI Average Annual Marketing Cost $55,000 32,064 35,968 Total Paid Employment in Full-time Equivalents (FTE) 1, ,168 Full-time Employment 1, ,900 Part-time Employment Expressed in Full-time Equiv Total Part-time Employment ,402 Total Labor Income $46,620,256 28,188,810 74,809,066 Total Wages & Salaries $36,719,264 22,575,228 59,294,492 Fringe Benefits $9,900,992 5,613,582 15,514,574 Average Earnings Per Full-time Employee $37,933 29,382 34,506 Number of Volunteers 4,928 10,998 15,926 Number of Volunteer Hours 247, , ,526 Estimated Value of Volunteer Time in Dollars $1,734,000 4,902,066 6,636,066 Total Attendance 9,774,064 4,012,164 13,786,228 29

31 Total Paid Attendance 2,807,856 2,033,850 4,841,706 No. of Paid Attendance by Non-Hawai`i Residents 1,351,280 1,409,148 2,760,428 Percent of Paid Attendance by Non-Hawai`i Residents Total School Group Attendance 604, , ,108 APPENDIX 5A HAWAI`I MUSEUM SAMPLE BY SUBGROUPS, 1996 (N = 46) Large Small Total (n=6) (n=40) (n=46) Total Revenues $35,138,452 30,698,094 65,836,546 Total Attendance 3,665,276 2,132,127 5,797,403 Admissions, Program & Membership Fees $9,889,889 6,112,005 16,001,894 Federal Grants/Awards $4,661, ,448 5,542,596 State Support $2,083,318 2,430,319 4,513,637 County Support $797,138 1,742,004 2,539,142 Note: Large establishments have attendance greater than 260,000 persons. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. APPENDIX 5B HAWAI`I MUSEUM SAMPLE SUBGROUP PROFILES Large Small Small* Number of Museums Non-profit organization For-profit organization Governmental organization Total Annual Revenues $35,138,452 30,698,094 23,352,494 Mean Annual Revenues $5,856, , ,782 30

32 Median Annual Revenues $2,968, , ,774 Revenues From Sources Outside Hawai`j $10,493,766 9,062,760 7,680,835 Percent of Total Revenues From Outside Hawai`i Average Annual Marketing Cost $55,000 32,064 32,064 Total Paid Employment in Full-time Equivalents FTE Full-time Employment Part-time Employment Expressed in FTEs Total Part-time Employment Total Employee Costs $17,482,596 14,455,805 12,114,231 Total Wage & Salary $13,769,723 11,577,043 9,775,675 Fringe Benefits $3,712,873 2,878,762 2,338,556 Average Costs Per Full-time Employee $37,923 29,382 28,707 Number of Volunteers 1,848 5,650 5,500 Number of Volunteer Hours 92, , ,432 Estimated Value of Volunteer Time in Dollar $650,251 2,513,863 2,447,863 Total Attendance 3,665,276 2,132,127 1,996,520 Total Paid Attendance 1,052,943 1,042,985 1,031,745 No. of Paid Attendance by Non-Hawai`i Residents 506, , ,120 Percent of Paid Attendance by Non-Hawai`i Residents Total School Group Attendance 226, , ,182 Note: Large establishments have attendance greater than 260,000 persons. *Minus one outlier. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. APPENDIX 6. HAWAI`I MUSEUM COMMUNITY REVENUES - EARNED VERSUS CONTRIBUTED INCOME, 1996 (N = 46) Source Amount Subtotal Percent of Total Earned Income 35,343,

33 Admission Fees 8,141, Program Fees 5,429, Membership 2,431, All Admissions 16,001, Gift Shop Revenues 5,381, Food Service 689, Other Sales & Services 1,393, All Sales 7,464, Investmt Income/Endowments 4,259, Shops/Concessions Rentals 1,683, Other ¹ 5,933, All Passive Income 11,877, Contributed Income 30,492, Federal Grants/Awards 5,542, State Support 4,513, County Support 2,539, All Governmental 12,595, Priv. Foundatn Grants/Trusts 5,889, Corporate Support 1,610, Parent Organizations 158, All Institutional 7,657, Ind. Donations/Contributions 9,915, Non-profit Support Group 292, Other Contributions 32, All Individual 10,239, Total 65,836,

34 1 Includes commission and royalties, sales of assets, parking fees, etc. Juanita C. Liu, 1997 Hawai`i Museum Study, University of Hawai`i School of Travel Industry Management. APPENDIX 7. HAWAI`I MUSEUM COMMUNITY REVENUES - IN-STATE VERSUS OUT-OF-STATE SOURCES, 1996 (N = 46) Source Total In-State Out-of-State Revenues Amount Percent Amount Percent Earned Income 35,343,993 23,628, ,715, Admission Fees 8,141,285 2,277, ,863, Program Fees 5,429,028 4,163, ,265, Membership 2,431,581 2,146, , All Admissions 16,001,894 8,587, ,414, Gift Shop Revenues 5,381,304 1,973, ,407, Food Service 689, , , Other Sales & Services 1,393, , , All Sales 7,464,950 3,490, ,974, Investmt Income/Endowments 4,259,917 4,248, , Shops/Concessions Rentals 1,683,956 1,670, , Other ¹ 5,933,276 5,632, , All Passive Income 11,877,149 11,551, , Contributed Income 30,492,553 22,651, ,840, Federal Grants/Awards 5,542, ,542, State Support 4,513,637 4,513, County Support 2,539,142 2,539, All Governmental 12,595,375 7,052, ,542, Priv. Foundatn Grants/Trusts 5,889,758 4,640, ,249, Corporate Support 1,610,023 1,550, ,