The statistic is revealed in The British Art Market in 2023, a report for the British Art Market Federation (BAMF) by Dr Clare McAndrew’s Arts Economics*.
Using data from dealer associations and the Office of National Statistics, the report found the number of VAT/PAYE registered commercial galleries and antiques dealers with premises in the UK had grown from 2775 to 3645 in 2023 (see chart above).
Regional UK statistics form a key part of the study that seeks to highlight to the UK government the importance of the British art market and raise awareness of its regional nature.
By region, VAT/PAYE registered commercial galleries and antiques dealers (with premises) were broadly spread across the UK, with just 34% in London (see graph below).
The latest British Art Market report is the fourth (the last published in 2017) but this is the first time it has recorded the regional nature of the British art market.
Dr McAndrew said she had compared the growth of dealers and galleries with wider business sectors which in comparison had grown by around 13% in the period, highlighting the positive outlook for the art and antiques sector regionally.
In terms of auction houses and salerooms, the report noted there are 3000 in the UK (from property to cars), with 800 of these believed to be selling art, antiques and collectables in some capacity and around 400 exclusively selling art, antiques and collectables.
It added: “Beyond the major auction houses of Christie’s, Sotheby’s, Bonhams and Phillips… there is a network of auction houses through the UK with only around 10% in London.”
Of the 80 members of the Society of Fine Art Auctioneers (SOFAA), 88% are outside London (see chart below).
The report also highlighted the financial impact of the art market to the wider economy.
McAndrew said she ‘conservatively’ estimates the art market contributed close to £1.6bn to the UK economy in taxes in 2022.
More than 7800 businesses operate directly within the art market, supporting over 45,520 jobs, with the annual expenditure of $3.2bn (£2.6bn) by the UK art trade on ancillary services and products (from insurance to restoration to legal services) supporting approximately 37,900 jobs.
Arts minister Lord Parkinson, who introduced the report at an event in Westminster on November 21, said: “Dr McAndrew’s report has charted the extraordinary resilience of the UK art market as it bounces back from the bleak months of the pandemic.
“The art market has been able to draw on its great wealth of expertise and dynamism to overcome the challenges of Covid-19 - and those will be invaluable resources to draw on as it faces the challenges of the future. But government must play its part too. We stand behind the sector as it works to retain its international competitive edge - and to remain a great British success story long into the future.
“Leaving the European Union has brought new processes, not all of them favourable. But having sovereign control of our borders has also brought the opportunity to innovate; to review and refine our customs rules.”
Lord Parkinson said DCMS is going through the responses to a recent consultation on reviewing Temporary Admission (TA) to reduce administrative burdens and will update on this in the new year.
The report highlighted just how important cross-border trade is to the UK’s art market: “London’s significance as an art market hub is not built on sourcing business locally, but on the flow of works of art in and out of London. There is strong empirical evidence that imports of art and antiques are highly correlated with the growth of the art market.”
It also noted that the “disruption to UK-EU trade brought about by Brexit caused a deterioration in the UK’s global position, and despite some recovery in the last two years, it has continued to lose share”. The British art market retained its position as one of the largest global hubs and is the second largest internationally with aggregate sales in 2022 of $11.9bn (£9.7bn), but still below pre-pandemic levels. However, the UK’s market share declined from 21% in 2016 to 18% in 2022, well below its high point of 34% in 2008.
The US continues to dominate with its growing share put at 45% in 2022.
Nonetheless, the UK market remains significantly larger than the EU art market as a whole, which accounted for 12% of global sales in 2022 and has remained static.
BAMF chairman Anthony Browne said: “The business of buying and selling art is something we are very good at… But the last few years have been very difficult with the pandemic, lockdowns… UK-EU trade. This report shows how incredibly resilient the art market has been. We have a bedrock of expertise and the infrastructure to back that up. But there is no room for complacency.”
Browne said he will continue to lobby government on tackling the red tape that hinders the sector, maintaining the need for support from government, and reducing import VAT for the arts sector.
*Dr Clare McAndrew, who holds a PhD in economics from Trinity College Dublin, is the founder of Arts Economics and has produced an annual macro-economic report on the global art market since 2005, firstly for TEFAF, then since 2016 for Art Basel and UBS. Alongside this she wrote and lectures a course for Christie’s Education called Art Market Economics and has been a guest lecturer on the Master’s programme at Trinity College Dublin.