• Zach Finkelstein

Young Artists, Big Business


Company X is a prestigious music apprenticeship festival for instrumentalists and singers. They take in about $15 million USD a year in revenue, own over $80 million dollars in assets, including real estate, investments, and cash on hand, and pay their CEO almost half a million dollars a year. Nearly two thousand young musicians paid $60 each last year to apply for a handful of spots, with no guarantee of being heard in person. netting the company an estimated $118,000 in application fees. And they pay their newly-hired apprentice performers absolutely nothing.

Which “non-profit” Young Artist Program is this? If you are looking at applying for music training apprenticeships, it doesn’t matter. It could be almost any of them.

Over the past two months, I’ve dug deep into the publicly available finances of dozens of American classical music apprenticeship companies, examining 990 tax records, AGMA union agreements, and online application websites like YapTracker and Acceptd, as well as secondary research from singers who currently attend or recently attended a top young artist program. I’ve compiled a database from these resources on fifty of the largest classical music apprenticeship companies in the US, the companies that are in the business of training elite, career-track musicians. Business, at least for the biggest programs, is BOOMING.

The 17-to-1 Pay Gap on Singer’s Wages: A Fridge too Far

My research shows that, of the 50 companies I’ve reviewed, nearly every top young artist program shares similar characteristics:

  • Top Executives make hundreds of thousands of dollars a year. More than a few cross the $500,000 a year threshold. Three company leaders make over a million dollars, in stark contrast with the wages paid to singers. For example, one company director makes $999,167 a year. $533 an hour, when their apprentice artists in their extremely prestigious program make less than $13 an hour, 41 times what an apprentice artist earns.

  • Most companies charge apprentice musicians an application fee, averaging around $32. This does not guarantee an audition, only puts your name in the hat. Application fees net the companies, by my estimates, on average about $20,000 in additional revenue.

  • Those application fees have almost no effect on the company’s overall bottom line- nearly all the Young Artist companies earn less than 1% of their revenue from application fees.

  • The top Young Artist apprenticeships in America, the ones that will likely skyrocket your career, offer between $20 and $39 an hour, based on a 36-hour week, about what a high school chemistry teacher earns. They also offer competitive benefits including housing, travel, additional compensation for more work, health insurance, and other normal ‘travel-for-work’ office job requirements.

  • The mid-range paid apprenticeships, still extraordinarily competitive, offer between $10 and $20 an hour with very few benefits- about what you’d make working technical support for Amazon. Most provide housing and travel reimbursement, and some pay additional compensation for main-stage roles.

  • The bottom tier of paid apprenticeships offer as little as $5.29, about what I made mowing lawns when I was 10, and less than federal law minimum wage. Companies work around minimum wage rules by calling it a stipend, which aren’t considered wages, but recipients still have to pay taxes on them. These are full-time summer jobs- you can’t take on another 20+hour-a-week job to fill in the income gap while you are on contract with a three-month summer festival. One of the most prestigious “paid” apprenticeship, for example, the one that offers $5.29 an hour for a summer’s work, pays a travel stipend of only $100 and requires artists to pay 5% of their fee if they "want" a mini-fridge and a microwave in their room.

  • The top-tier unpaid apprenticeships I’ve included in the list range from a “full scholarship” (i.e., they don’t charge you to attend) to as much as $10,000 in tuition and housing for the privilege of performing at their prestigious festivals. Some of these apprenticeships are four months long with no pay. Ironically, these are some of the most healthy and successful companies on the list, with revenues in the $10s of millions of dollars. A few of these pay-to-sings are in the top 10 biggest companies on the list, eclipsing most of the paid companies’ revenues and net assets.

  • Most of these companies have millions of dollars in assets, including real estate, investments, and cash. Some have hundreds of millions in endowments and/or own the apartments and dorms, allowing them to double-charge musicians as landlords for both tuition and room and board. One young artist festival on the list, an organization that does not pay its young musicians, has assets on hand of over $115 million with yearly gross revenue of over $25 million. The top five companies on the list, one of which does not pay its apprentice artists, have a combined net assets of $1.485 billion dollars.

The average company on this list:

  • Pays their CEO $386,430 USD per year or about $206 an hour;

  • Grosses about $23 million in revenue a year (ticket sales, donations, grants, etc.);

  • Stashes away about $50 million for a rainy day in net assets (real estate, investments, cash);

  • Charges their artists about $32 to apply (first round, not to be heard live) for an audition;

  • Takes in less than one percent of their revenue from application fees;

  • And, of the 41 companies for which I could calculate hourly rates, they paid their singers less than $13 an hour. The Top Executive on average makes about 17 times what their musicians take home.

Arts Executives Say Application Fees Are Necessary. Are They?

A few years back, Classical Singer interviewed a number of YAP directors about why singers have to pay to have the chance for a live audition:

Director A

“Most companies have to charge audition fees to balance the expense of holding auditions for their program. Opera A’s fee is as low as we can possibly charge, and there is no extra income from the fees we charge for auditions.”

Director B

“There is an extraordinary amount of organization and staff time that goes into screening auditions. Every applicant’s recordings are listened to in full and every résumé is screened.

While it may seem unfair to charge a fee to someone who isn’t granted a live audition, this fee barely covers our expenses. Most opera companies are nonprofit organizations. We are keenly aware of the expenses involved in beginning a career in opera. As a former singer, I am perhaps more aware than most. Because of this, we do not ‘make money’ from fees. Our goal is to simply break even.”

The idea that artist fees pay for audition panel hotels, travel, and accompanists, that they are a necessary part of the revenue for a company to survive or “break even”, is an interesting argument. It’s also testable.

As the size of the company (approximated by total revenue) increases, is there a positive or negative correlation with the amount charged for an application fee?

For example, the chart above is a good fit to the model that revenue and leader salary have a positive relationship. There are a couple of outliers- the tough negotiator making over $2 million at a sub-$50 million arts organization! Still, as the size of a company increases in terms of total revenue, the management salary, for the most part, increases. Top jobs are rewarded with top dollars. Fortune 500 companies pay more than Mom & Pop operations. Makes sense, at least in principle, although not in the absurd discrepancy with entry-level wages.

There’s also a slightly positive relationship between revenue and apprentice artist hourly pay, although the relationship is not as strong as the one for top management salaries:

Most of the pay for artists clusters in the $8 to $18 range, with 3 companies in the $25 million revenue or higher group who don’t pay their apprentice artists anything.

When we look at application fees though, there doesn’t appear to be any kind of linear relationship between the size of the company, measured in total revenue, and the size of the fee.

For total revenue, some small companies charge no application fees, some massive companies charge about the average fee, and most of them are clustered around the average of $32 regardless of size. What this tells me is that there is likely a default market rate for applications and that most will charge artists the market rate, likely because that’s what artists have shown they are willing to pay, or perhaps a herd mentality that they should charge whatever the competition charges.

In addition, the estimated total application fees are not a substantial part of total revenue for any of these companies. Almost every apprentice company I’ve reviewed, according to their IRS 990 filings, make less than one percent of their yearly revenue from application fees.

Give me your tired, your poor, your uncommitted and unqualified

There are two other arguments from companies we need to address: the use of application fees as a commitment device to ensure musicians will show up, and the idea that removing application fees will open the floodgates for even more people to apply, reducing the overall quality of the applicant pool.

“When you charge a fee, you are more likely not to have a cancellation. Paying a fee creates a sense of commitment.”

Paying $30 may not be at all necessary to insure an applicant is committed. You know what are good commitment devices? Spending hours filling out online applications. Curating CVs. Paying $200 for new headshots. Spending another $300 on recording arias and art songs. Begging for recommendation letters. Writing all the information in your resume over and over again in tiny boxes on a website application. Spending another $400 on a round-trip flight. Emailing friends and acquaintances to arrange housing. Flying to New York. Dealing with JFK shenanigans. Crashing on couches. And lugging your carry-on around the Manhattan subway and back to JFK.

No one travelling in for an audition to New York or the Company city is going to cancel the day of an audition because it was “free” It’s not free- they spent hundreds of dollars and days, maybe even weeks working on that application.

For locals, it’s certainly possible with no travel costs they may cancel more without financial incentive. It’s possible they are more likely to stay home and cancel if they’re sick. But who wants to hear a sick singer stumble through ‘Casta Diva’? If anything, allowing someone the financial flexibility to cancel if they are not at 100% is going to increase the quality of your audition pool.

The final company argument against application fees is that making an application free will somehow overwhelm the company with too many applicants, and every young singer will just apply to everything. We’ve just shown that there is no relationship between the size of a company and the application fee, and that some of these incredibly successful companies charge nothing for applications. If they’re overwhelmed, they hide it well. One of the top twenty largest young artist companies in America has not charged a fee for applications since their inception in the 1950s- it was a moral imperative of the founder. They are currently one of the leading opera companies in the world and still adhere to their founder’s egalitarian vision.

The argument also assumes there is a relationship between the quality of someone’s voice and how much money their parents make. For example, let’s take two 20-year-olds with equally fabulous voices graduating from Julliard, Jake and Jane. They both want to apply to five young artist programs, but only Jake can afford the money and time. Jake comes from rich parents who paid his tuition, while Jane has student debt and has limited funds to spend on headshots, recordings, and application fees. Jake can apply to all five. Jane can only afford to apply to two.

If application fees were eliminated, and Jane applies to five programs, is that “too many?” If both singers are equally skilled, shouldn’t they both have an equal shot at an audition? And wouldn’t it be a better outcome for the Company to hear both singers?

And finally, if there is a flood of applications, say, 2000 instead of 500 that apply to your program because it’s now “free-to-apply”, there are turnkey online solutions. Fortune 500 companies deal successfully with much larger application pools through free or low-fee subscription AI-enabled websites or software. For example, if you are an elite apprenticeship company and it is critical to your admissions process that applicants have paid apprenticeship or mainstage experience before they apply, you can make your pre-screening weighted more on CV. You could auto-search certain keywords on CVs and filter based on those results, say by top paid apprenticeship or a list of major US houses. Singers, like college grads applying to tech companies like Amazon or Google, would learn quickly to tailor their CVs to the new normal.

Or you could apply a ‘three strikes, you’re out’ policy. Musicians can apply three times to your program and if they don’t make the cut on the third try, then they’re off the list. This would be easy to enforce and reduce the number of high-volume, less committed applicants giving you headaches, musicians spamming 20 programs a year for five years in a row.

In sum, there is just no good reason for most of these companies to charge musicians application fees. In fact, none of these companies need to be charging publicly performing musicians anything at all.

Application fees are chump change to most music apprenticeship companies, barely a rounding error in the yearly budget. But to musicians below the poverty line, to those living hand-to-mouth, who have to choose between paying for lessons and paying their rent, and who feel they must, based on the insurmountable odds of “making it,” apply to dozens of these programs every year, application fees are an ungainly burden.

A Call to Action

At some point, the management and board of directors working for companies that train artists need to address the moral hazard of their choice not to pay young musicians, or pay them “stipends” less than minimum wage that don't cover their travel and cost of living, and to charge them for a chance at an audition. Especially, when the CEO is making hundreds of thousands of dollars a year and the Company is sitting on tens or in some cases hundreds of millions of dollars of real estate and investments.

At some point, these leaders need to decide: what do they stand for as artistic administrators and career shepherds? Are the companies primarily non-profit with a core mission to help train young professional musicians? Or are young singers just a cheap business development tool to drum up new leads and put bums in seats, one more way to cut labor costs by paying people less than minimum wage to perform mainstage roles?

The solution for this will never come from the powerless, the young musicians themselves. Desperate people told to follow their dreams will do whatever it takes and pay whatever cost. It must come from above.

For example, what if we didn’t pay the Managing Directors $300,000 a year? What if we paid them 150k? That’s still competitive in the non-profit sector. With those savings, you could cut all application fees and pay your apprentice singers a living wage, AGMA union rates at $1,000 a week, and turn your program into a real job with benefits. Aspiring singers and musicians wouldn’t have to lose two or three months of wages and sublet their apartments to train with you. You could give them healthcare. You could give them a financial head start on their career, instead of leaving them mired in debt. And it goes without saying, you could cut out the application fees.

If you’re going to require six, eight, a dozen of these programs under someone’s belt in order to have a career, if you’re going to require a decade of someone’s prime earning years, if, as you say in your mission statements, your purpose is to “shape the future of opera,” you have a moral responsibility to pay your artists a living wage. And you have the means to do it. You just need the will.

ZF


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