As the theater of economics has played out on the world's stage this year, it has, in some ways, upstaged Ashland's own theater.

As the theater of economics has played out on the world's stage this year, it has, in some ways, upstaged Ashland's own theater.

The Oregon Shakespeare Festival has felt the effects of plunging stocks and rising gas prices and has scaled back its budget for next season, Executive Director Paul Nicholson said Wednesday.

"We're remaining strong in the face in a pretty severe national and global economic situation, but we're not immune to what's going on elsewhere," Nicholson said.

Next year's estimated budget of 26.5 million is about $200,000 lower than this year's, he said.

OSF officials believe box office revenue will fall next season, and have estimated ticket sales will make up only 60 percent of the budget, as opposed to the typical 65 to 68 percent.

"This year we're at 90 percent of capacity, which is very, very high. We think it would be really foolish to think we're going to be at 90 percent of attendance next year," Nicholson said.

Festival organizers have decided not to raise ticket prices by as much as usual next season, although they will still offer discounted $20 tickets for certain seats in all performances.

No OSF employees will get salary increases next year, as a result of the budget crunch, said Nicholson.

A few employees have been laid off, he said, declining to say how many, but noting that the equivalence of four fulltime, year-round positions have been eliminated.

Workers were briefed on the budget changes Friday and most seemed relieved to know what to expect next year, Nicholson said.

"What we're trying to do, the key thing that we're trying to do, is maintain jobs for the people who work here. That was the key component of our budgeting. We have cut back in some areas, but by and large we've been able to maintain the festival as it operates now."

Funding for production costs, such as costumes and sets, has been decreased slightly, although the festival plans to have the same number of theater shows as this year.

OSF will eliminate the last week of Green Shows next season, scaling back from 126 productions this year to just over 100, said Claudia Alick, associate producer.

She, in fact, sees the effects of the budget tightening as positive.

"It's always been my philosophy to think better not bigger and to always err on the side of quality over quantity so I've been hoping to reduce the number of Green Shows we produce for awhile. The fiscal savings are a side benefit," Alick said.

The free shows, mostly music and dance performances, are done as a service to the community and patrons of the festival.

"Our greatest concern is audience satisfaction. I've been concerned about audience comfort towards the end of our season when the weather gets colder and more unpredictable," Alick said.

OSF can always expand the number of Green Shows next year if demand is high, she added.

Although it's too early to know for sure, Nicholson said he thinks the festival budget may be in the red this season, and that has also been factored into next year's scale back.

"At the moment I'm predicting that our ticket revenues will be under-budget. I don't know how much under-budget yet," he said.

Nicholson said he thinks other tourism-related businesses in Ashland are also feeling the hit of the economic downturn.

"We're trying to ensure the festival's future. And let's be real, if the festival doesn't have a future, Ashland's going to be in real trouble," he said.

Katharine Flanagan, marketing director for the Ashland Visitor and Convention Bureau, said about 1/3 of the city's 350,000 annual visitors see OSF plays.

The bureau is pitching other recreation activities, like fly fishing, wine tasting and whitewater rafting, in their new marketing campaign slogan, "OSF is our front yard, discover our backyard."

Flanagan said Ashland's business owners seem, for the most part, to be adapting to the changing economic times.

"All in all, we've gotten through the summer because we have smart entrepreneurs. As we look toward next year I think every wants to be careful and realistically optimistic.

"Really I think we are all partners in promoting Ashland. Ashland needs Shakespeare like Shakespeare needs Ashland, because if you put Shakespeare in a different town, it might not work," she said.