An Excellent New Read: "A Brief History Of Why Artists Are No Longer Making A Living..."

Very few musicians create and survive because of the industry, they do so in spite of it. 
Some of the great "record men" like Mo Ostin, Ahmet Ertegun and Chris Blackwell, to name three, were able to run a business that fostered some great music.
Today, I'm sure there are others who people can identify as producers or small label owners that are cultivating and helping to commercialize music. 
But the market is so fragmented, music is not even a commodity most people are wiling to pay for, and the make up-- on the road, touring, is a hard way to live.
Songwriters tend to do better, particularly if they can compose for film or other niche business to business markets.
I don't lament the death of music as an art form, but the days of record labels handing out 1/2 million dollar advances on spec to no name artists are long gone.
Every once in a while, there's a surprise. And in my experience, that was as true when the business was humming along swimmingly- the business of music isn't really about music. That's just a coincidence of talent and the right things happening. If someone knew how to predict taste, they'd be swinging. And I think that was always so. 
I do like a lot of eras from the 20th century, though. 

I think I have a fair idea notwithstanding @orpheus10 ’s comments. I worked as an outside lawyer and did a considerable amount of work in the music industry-- mainly music publishing but a fair amount of work for the labels, major and minor-- as a copyright lawyer. I was based in NYC but dealt with matters pretty much all over the world.
I also spent a fair amount of time with musicians, producers, venue owners and others involved in the business. And cared about music and sound. Some of the people in the industry are music lovers- some are just business people. That’s always been true, at least as long as I’ve been around, and my understanding of the history before my time is that it wasn’t much different. Even the big name artists often didn’t earn. And the band members- well, a regular gig was a good thing. Appearing on a record didn’t mean much in terms of money as a sideman (or woman). The credential was good, and hopefully led to more work.
My take is that we have this "rosy" view of the past: it has never been easy for musicians trying to work full-time based on their art. That, of course, was the key- to be able to make enough money from songwriting or performing to be able to devote full time to the art without having to work a "straight" job to put food on the table and cover the rent, kid’s needs, etc.
I don’t think it has ever been easy. The days of the majors as a funding source and incubator for aspiring musicians to develop their craft are largely gone to the extent that even existed. Some labels, like Warner Bros here in the States, had some pretty amazing in-house producers who were able to foster and help develop talent. As mentioned, Chris Blackwell was another person who had an ear for music, not just counting the beans and in some profound ways, shaped the sounds of rock, progressive rock, reggae (he helped put Bob Marley on the map) and other sounds, e.g. Fairport Convention, though a lot of credit is due to the artists as well as Joe Boyd. Guy Stevens, who worked for Island and produced some great records, went on to break The Clash, which was pretty successful at the time.
Independent producers today are a driving force but getting hooked up with the right people isn’t easy. I’m now based in Austin, which is a vibrant live music town, but there is very little in the way of "infrastructure" compared to Nashville, which has long had publishing and an established studio/session player scene. A friend was on four tracks on Paul McCartney’s latest album- he makes a living, but even with that level of talent, he needs the gigs, record sales are a fraction of what they once were, streaming royalties are no pot of gold and gigging-- it may be ok when you are 20, but if you are 60 years old?
It’s always been a tough business. The people that "hit" are sometimes spectacularly talented, but there are a hundred others, just as talented, who are unknowns. I think this is as it always was.
The best we can do as consumers and music lovers is to support the local venues, buy recordings, go to shows (some are quite expensive now) and find other ways to help. There are any number of non-profits that offer everything from legal advice to health care and aging assistance; there are start ups which act as incubators; you can fund artists through kickstarter type projects or buy their work on band camp.
There’s lots of talent out there. People complained about being force-fed crappy music when the majors ruled. Well, nobody is force feeding anything these days- radio promotion is a thing of the past and apart from a few big name artists, most releases are not accompanied by huge marketing campaigns.
Sorry if this sounds preachy, but it’s real easy to say new music sucks and there’s no good path to reach audiences anymore. I think there is a lot of great current music and you can get it easier and cheaper than ever before (legitimately). If you want to do more, that’s up to you--

Offhand, the only city in that video that played a significant role in the pop music scene was Detroit. Motown moved to the West Coast by 1972 and in its wake were a lot of seasoned players left without work. One of them, Wendell Harrison, formed Tribe Records, which tapped into a vein of so-called "spiritual jazz"- a mix of post bop/modal jazz that mixed soul and funk. Wendell is alive and well, and that scene is still thriving. The Grande Ballroom, a major venue for hard rock, closed in the early ’70s.
Other cities, like Pittsburgh, had a notable local jazz scene, but that was true of many US cities. Jazz started a decline by the ’70s as a form of popular music. Detroit, Pittsburgh and Cleveland had great symphonies, but I don’t attribute the decline in classical music to the economy, then or now. The audience has aged out and sadly, there is little interest among younger generations. Almost all of those cities, and many more, had local rock bands that typically moved to NY or LA at the time to get a break. That’s changed, since the industry changed. Blame it on Pro Tools.
Youngstown was famous for studio wrestling. I don’t know why that isn’t popular any more.

@ivan_nosnibor the people that often rail against the system most are other lawyers! No slight read into your post. I teach now part time, I’m retired, and the challenge is helping young earnest people who are smart find a path that is meaningful and can pay the bills-- not unlike our artist friends. Well, that’s a stretch, but it’s a similar big universe of a talent pool with a small number of slots for people in the go-to firms to reach partnership level- and that business has changed too. My first question to any young person who is considering law school is to ask what they are passionate about. I’ve met many interesting people during my career and that was, in retrospect, probably one of the rewards for the hard work, hours and stress.