Today TIGA (The Independent Game Developers’ Association), the trade association for the UK video games industry, have revealed the information gained from their research taking place between November 2017 to November 2018. This research covers a number of aspects, including studio headcounts, investment from studios and also the tax generated by the UK games industry.
What is the biggest takeaway from this report is that the UK games industry is now the biggest it has ever been, with the headcount of “creative staff” reported at over 14,350, an 8.1% increase from the year ending November 2017, which had numbers of 13,277. The total number of people in games development has risen to 16,532 from the previous years 15,851. Another large point is that the games sector now contributes £1.8 billion to the UK’s GDP.
Here are the key findings of this research:
- the number of creative staff in studios surged by an annualised rate of 8.1 per cent from 13,277 to almost 14,353 full-time and full-time equivalent staff, with much of the growth in employment being driven by larger companies;
- the total games development workforce, including contractors, grew from 15,851 to 16,532, a record high;
- the number of jobs indirectly supported by studios rose from 24,274 to 26,241;
- combined direct and indirect tax revenues generated by the sector for the Treasury are estimated to have increased from £613 million to £747 million;
- annual investment by studios rose from £737 million to £818 million; and
- the game development sector’s annual contribution to UK Gross Domestic Product increased from £1.6 billion to £1.8 billion.
Dr Richard Wilson, the CEO of TIGA, had this to say regarding the results:
The UK video games development sector surged forward in 2018, growing more than five times the rate of the UK economy. Employment and investment in the sector reached record levels in 2018 and the industry’s contribution to GDP reached an all-time high of £1.8 billion.
Our industry is growing for three reasons. Firstly, the UK is one of the finest games development centres globally, with outstanding small, medium and large studios creating content that sell all over the world.
Secondly, the prevalence of mobile and tablet devices, the launch of upgraded consoles, the popularity of PC games and the advent of Virtual and Augmented Reality are encouraging investment in games.
Thirdly, and most significantly, Video Games Tax Relief (VGTR) is enabling our sector to grow strongly. TIGA played a critical role in the long battle to win VGTR, which effectively reduces the cost and risk of games development and is incentivising investment and job creation in the games industry. There is a clear connection between the advent of VGTR and headcount growth in the UK games development sector. The UK games industry declined by an annual average of 3.1 per cent between 2008 and 2011, before VGTR existed. Since VGTR has been available, the average annual growth rate has been 7.5 per cent.
However, this isn’t to say that everything is perfect, with there being challenges currently faced by the UK games industry, as well as a host of challenges still to encounter. Finance for video games companies is still difficult to obtain, recruitment of skilled individuals is notoriously difficult across many sectors, including video games and the ever-looming spectre of Brexit. On the challenges to face, Richard Wilson also had this to say:
The sector still faces serious challenges, particularly with respect in access to finance and in access to highly skilled people, to exploit this rapidly growing market in which the UK is a golobal success story. We should now reinforce our successful industry by introducing a Video Games Investment Fund (VGIF) to improve access to finance. We should also continue to strengthen industry-university links, enhance skils and training and enable UK games companies to recruit highly skilled workers from the EU and beyond. This will ensure that our sector continues to create more jobs, more investment and more video games.
As video games continue to grow, having surpassed both Films and Music combined in the UK retail market, the opportunities should certainly be there for any company within the games industry, particularly those based in the UK. However, the political climate and possible ramifications do make this a difficult one to predict.
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