The Living Wage for Musicians Act aims to give artists fair pay directly from music streaming. Now, it’s being backed by the New York City Council.

New York City takes a stand for artist pay

New York City Council (NYC) has backed plans that could revolutionize how musicians are paid in the streaming era. Last week, the City Council passed ‘Resolution 368’, calling on the US Congress to pass the Living Wage for Musicians Act (LWMA). The LWMA was proposed last year by Congresswoman Rashida Tlaib and former Congressman Jamaal Bowman developed in conjunction with the United Musicians and Allied Workers, and aims to introduce a new royalty system that “create a new streaming royalty paid directly to artists”.

How would this “new streaming royalty” be created exactly? Well if passed, the act would add a 50% levy to all music streaming subscription prices in the US under federal law. This additional charge would go into a fund that pays musicians directly, bypassing labels and distributors.

Why this matters for NYC and the artist community

Despite streaming platforms like Spotify paying over $10 billion to artists across last year alone, the proposal highlights the difficulty for artists to earn a sustainable income from streaming.

“Passing the act at the federal level is key to making NYC more affordable for working musicians – to live, create and thrive in the music capital of the world.”

Shahana Hamif, NYC Council Member

NYC recognizes this difficulty for its estimated 14,000 working musicians, stating that many “face volatile employment situations and economic insecurity”. Session musicians and backing vocalists often don’t earn royalties from streaming at all, instead receiving one-off payments for their time.

A wider issue

This issue isn’t just exclusive to New York- it signals wider momentum to address fairer payment for artists in the streaming economy. Streaming platforms are often the subject of criticism regarding royalty payouts. For example, some platforms have recently faced backlash for minimum stream thresholds before royalties can be paid out, which disproportionately harms smaller artists

The LWMA shines a spotlight on the challenges artists face with the current system, where the royalty payouts are often filtered further through labels and distributors, based on any contractual agreement.

That is where independent distributors such as RouteNote come in. At RouteNote, we let artists choose the best distribution for their needs. Artists can either upload unlimited music for free and keep 85% of all royalties, or opt for a Premium plan and keep 100% of earnings with a competitive one-time fee for each upload.

How the levy would work

If passed, the LWMA would require streaming services to increase their monthly subscription fees by 50%. For example, Spotify prices in the US may be:

  • Premium subscription would increase from $11.99 to $17.99
  • Family plan would increase from $19.99 to $29.99

The additional revenue would go into a new fund designed to compensate artists and musicians directly. Complete Music Update has done the calculations, and with over 100 million paid subscribers in the US and an estimated 169,300 musicians across the US, the average payout could reach $42,500 per artist per year.

The money could then be split between main artists, feature artists, and session musicians, offering fairer compensation to those behind the scenes. As a result, the LWMA ensures that all working artists can earn a sustainable income.

Not everyone is on board

While the act sounds like good news for artists in theory, it will likely face serious opposition. Streaming services and major labels are likely to resist, especially given they have already pushed back against Canada’s far smaller proposed 5% levy. A 50% price hike signals the most aggressive proposal globally, and at a much larger increase than those gradually rolled out in recent years by Spotify.

Critics, including major labels and distributors, argue that it could cause many to unsubscribe. Not only would this trouble streaming services and labels, but it would also render the levy ineffective as due to the lost revenues from those unsubscribing. 

A step in the right direction

Whether or not the LWPA becomes law, NYC’s support reiterates a key message around fair compensation for artists. As streaming continues to dominate music consumption, it’s important that all artists can earn a sustainable income- something that recent industry “Streaming 2.0” initiatives seem to undermine.


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