UK game industry returns to growth

UK game industry returns to growth
Will Freeman

By Will Freeman

March 18th 2013 at 9:19AM

Games employment up four per cent in 2012 after three years of decline

Trade body Tiga has today published research that shows a return to growth for the UK game industry.

The data, published in the report 'Making Games in the UK Today: A Census of the UK Developer and Digital Publishing Sector', shows that employment in the UK games development sector climbed four per cent in 2012, bucking a three year trend of decline in employment. Similarly, annual investment by studios rose from £411 million to £427 million in the period between 2011 and 2012.

The research is based on an survey of various UK games businesses, with input from Games Investor Consulting, and published by Tiga. The report also demonstrates that between 2011 and 2012 in the UK:

• Creative staff in studios grew from 8,888 to 9,224
• Jobs indirectly supported by studios rose from 16,250 to 16,864
• Studio numbers rose from 329 to 448;
• Direct/indirect tax revenues generated by the sector for the Treasury increased from £376 million to £400 million;
• The sector’s contribution to UK Gross Domestic Product increased from £912 million to £947 million.

“The UK economy may be on the verge of a triple dip recession but the recovery in the UK games development sector has taken off," said Tiga CEO Richard Wilson.

"Employment, investment and start-ups are up. The games development industry is growing again.

“The sector’s return to growth has been driven by three factors. Firstly, the increasing prevalence of mobile and tablet devices have created a growing market for games: studios are setting up to meet this demand. Secondly, the closure of big console based studios has been followed by an explosion of small start-up companies. Thirdly, the advent of Games Tax Relief, which Tiga was instrumental in achieving, is already stimulating growth.

"Games Tax Relief effectively reduces the cost of games development and it has contributed to inward investment by major international games companies including Activision Blizzard (The Blast Furnace), Gree (Gree UK), Konami (PES Productions) and Microsoft (Lift) in British studios in 2012. Jobs and investment in the games industry are set grow further once Games Tax Relief comes into effect from April 2013."

Point to a lack of games industry tax releif in recent years as part of the problem for UK developers, Wilson did recognise a challenge remains for the UK's games sector, stating that developer headcount and investment levels remain below their 2008 peak.

"Our challenge now – and Tiga's top priority – is to help build sustainable independent games development and digital publishing businesses," concluded Wilson.

"Tiga will do this by delivering services that improve developers’ access to finance and which enhance their commercial skills.”