U.S. Art Museums Still Searching for Solutions Amid Ongoing Financial Woes

American Alliance of Museums member institutions are still looking for ways to increase attendance—and revenues—while lowering expenses.

The job of operating art museums has always been a demanding one, but the last few years have seen challenges piling up for those who lead cultural institutions. Not only have museums needed to rebuild the numbers of regular visitors and members, many of whom let memberships lapse during the pandemic, but they have also faced calls to expand outreach to underrepresented and underserved communities. Initiatives have involved broadening permanent collections and programming, as well as making their full-time staff and part-time and volunteer docents more diverse—all of which incur new costs. Unionization efforts at a growing number of museums and overall calls for increased salaries have also added financial pressures.

A photograph of people lined up in front of a museum
The Oakland Museum of California. Courtesy the Oakland Museum of California

“Museums are dealing with a litany of issues all at the same time,” said Linda Harrison, director and chief executive officer at the Newark Museum of Art, and some institutions have struggled more than others. New York’s Solomon R. Guggenheim Museum laid off ten employees, citing inflation-related expenses, such as insurance and labor costs, as well as fewer visitors and memberships. The Dallas Museum of Art recently announced that it was furloughing twenty full-time staff, reducing the number of traveling exhibitions imported to the institution and keeping its doors closed on Tuesdays (the museum is not open on Mondays) as a result of rising costs, the end of pandemic era federal emergency funding and a drop in the number of visitors, while the San Francisco Museum of Modern Art eliminated twenty staff positions due to a 35 percent decline in visitorship compared to 2019 attendance.

A woman wearing a blue dress poses for a portrait
Brooke Leonard of the American Alliance of Museums. Courtesy Brooke Leonard

Christopher Bedford, director of SFMOMA since 2022, issued a statement in November indicating that “general admissions and membership fees are essential sources of [the museum’s] financial support” and that “the reduced foot traffic in San Francisco’s Downtown Core and our city’s broader economic issues” had led to budgetary shortfalls. However, as he seeks to bring back visitors and members to the museum and increase operating revenues, Bedford embodies the new spirit of making institutions an instrument of social change. Several museums have sold off, or deaccessioned, artworks in permanent collections by white male artists to purchase pieces by members of underrepresented groups, such as artists of color, LGBTQ artists and artists with disabilities.

Bringing in new audiences while trying to re-attract traditional visitors is a lot to ask these days. In cities such as New York, Los Angeles and San Francisco, a large percentage of the visitors to museums are international travelers, according to George Edwards-Stimola, a credit analyst at Fitch Ratings, which evaluates the credit-worthiness of organizations that issue bonds, some of which are museums, as part of their capital campaigns. “International travel to the U.S. is down, and some museums do rely heavily on tourist spending.”

Other problems facing Bay Area art museums in particular are holdovers from the pandemic. “People got out of the habit of going out,” said Lori Fogarty, director and chief executive officer of the Oakland Museum of California, which has seen a 30 percent drop in visitorship compared to the pre-pandemic era. Working remotely some or all of the time has made city centers less crowded. “The cultural institutions and the restaurants are all emptier.” Fogarty also attributed “concerns about crime” in Oakland and San Francisco to dropping museum attendance.

A women wearing a blue cardigan over a black shirt poses in front of trees
Lori Fogarty of the Oakland Museum of California. © Terry Lorant Photography

People still visit museums, but perhaps they aren’t going as often, said Seattle, Washington-based museum consultant Susie Wilkening. “If a person was visiting six museums a year pre-pandemic, now they might be visiting three or four. Or, if a person visited a specific museum four times a year, maybe now they are visiting twice. This little bit of slippage can result in reduced membership revenues as there are fewer people joining to save money on admission fees.”

Over the past three years, average museum income dropped 40 percent, said Brooke Leonard, chief of staff and interim chief executive officer of the Washington, D.C.-based American Alliance of Museums. Looking to the future, museum officials see the path to financial recovery involves “reaching new audiences” and not just re-attracting the people who have come in the past. “Museums are rightly looking at all of these people. It is a business imperative.”

She noted that AAM member museums have been seeking ways to increase revenues while lowering expenses, although perhaps not as publicly as the Dallas Museum of Art and the San Francisco Museum of Modern Art. But, most notably, they have been aiming to increase their attractiveness to different groups in their communities, such as those with lower incomes and others who are non-white. Museums need to represent “not just collectors of art or people who are privileged by wealth and education” but the broader community that may not yet view museums as part of their everyday experience, said David Ross, former director of both the Whitney Museum of American Art and the San Francisco Museum of Modern Art. Attracting these audiences has become a major goal.

Acquiring and exhibiting more works by contemporary artists and artists representative of previously overlooked groups is one solution to the problem of how to make the museum more a part of the community. Hiring a more diverse staff is another. “In 2020, 25 percent of our staff was BIPOC,” or Black, Indigenous and people of color, Harrison said. “Now, it’s 38 percent. When you have a more diverse staff, you engage with a wider body of people in the community.”

Linda C. Harrison, Director of the Newark Museum of Art, poses for a portrait at the museum in Newark, N.J., on October 26, 2023.
Linda C. Harrison, Director of the Newark Museum of Art. Bryan Anselm/Redux

Yet another is recruiting volunteer educators, often called docents, who lead students and other groups through the permanent collection and special exhibits. The stereotypical museum docent is an older white woman, and institutions have been working to alter that demographic. The Boston Museum of Fine Arts, for example, has sought to “develop inclusive recruitment strategies in efforts to cultivate a diverse pool of volunteer candidates that are reflective of the audiences the MFA serves,” according to a spokesperson. Two years ago, the Art Institute of Chicago took a less gradualist approach, ending its volunteer docent program and replacing it with an initiative of both paid and volunteer educators “that allows community members of all income levels to participate, responds to issues of class and income equity, and does not require financial flexibility to participate,” according to a statement issued at the time by the museum’s board.

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Other museums, including the Portland Art Museum in Oregon and the Oakland Museum of California, have done the same. “It has been a two-year process to restructure our docent program,” Fogarty said. “Some of our older volunteers were disappointed by what we were doing, and it is still a challenge to find younger volunteers to work with school children.”

Change is never easy. Marianna Adams, a museum consultant in Dallas, Texas, said that “making changes in docent programs of any type can be a dicey process. They are usually quite entrenched and often donors are connected to board members. Sometimes even the smallest, seemingly innocuous change can cause big ripples. They go directly to a board member or the director and then the museum education department gets called on the carpet.”

Figuring out what actually works is itself a work in progress. In 2012, the Dallas Museum of Art eliminated its $10 general admission fee, with the idea that removing a barrier to entry would bring in visitors who had not come there before. The loss of admissions revenues, although covered by a newly created endowment, would be made up for with increased visitorship, which was the experience of the Indianapolis Museum of Art. That institution saw attendance double after it dropped its admissions in 2007. (In 2014, the museum returned to charging admissions, which are now $20 for adults.) Based on the announcement by the Dallas Museum of Art, it would seem as though eliminating admissions led to enough visitors to keep the institution’s budget balanced. Earlier this year, on the other hand, the San Francisco Museum of Modern Art increased its general admissions to $30, but it does not appear the additional revenues generated from the price hike were enough to overcome the shortage of visitors.

Not necessarily new but yet another major challenge for museum officials is growing their institutions through physical expansion, which has been a trend at large and mid-sized institutions over the past generation, resulting in major capital campaigns and ever-enlarging budgets. The new wing, the expanded campus absorbs the cash and energy that might go elsewhere, according to Maxwell Anderson, president of Souls Grown Deep and former director of the Whitney Museum, the Dallas Museum of Art and the Indianapolis Museum of Art at the time that it dropped its admissions. “Espousing new commitments to social relevance is warranted and well-intentioned, but these have not yielded much-needed philanthropic generosity to keep up with bigger facilities needing more resources,” he said.

U.S. Art Museums Still Searching for Solutions Amid Ongoing Financial Woes