In 2016, the UK Games Industry directly employed 20,430 FTEs and contributed £1.52bn in GVA to UK economy
- Including indirect and spillover economic impacts, this rises to 47,620 FTEs and £2.87bn in GVA
- At least £1.75bn of overseas investment into UK games companies in 2015-2017
- £1.25bn spent on game development in the UK in 2016
- £389.9 (31 per cent) of UK expenditure supported by VGTR, 68 per cent of which is additional
- VGTR supported 9,240 UK industry jobs, including 4,320 FTEs directly in game development
- VGTR contributed £294.1m in GVA, rising to £525.0m with indirect and spillover impacts
- Every £1 invested into the games industry via VGTR generated an additional £4.00 in GVA for the UK economy
London – 9 October, 2018 – New figures released today reveal the true scale of the UK games industry, with overall workforce and development spend significantly stimulating growth in the UK economy. The data shows that in 2016, the UK games industry directly employed 20,430 people and contributed £1.52bn in GVA to the UK economy. With indirect economic and spillover impacts included, these numbers rise to show the industry supporting 47,160 jobs and contributing a total of £2.87bn in GVA.
The report, ‘Screen Business: How tax incentives help power economic growth across the UK’, produced by Olsberg SPI and Nordicity, and commissioned by the British Film Institute, investigates the contribution to the economy of the UK screen sector tax reliefs, including the VGTR. It also includes an analysis of the total economic impact of the UK games industry, including detailed assessments of the development, publishing, retail, esports and merchandising subsectors.
In its role as industry advisors to the steering group, Ukie contributed heavily to the report, including providing detailed data from its UK Games Map (gamesmap.uk) and analysis showing that UK developed games account for 17.3 per cent of sales revenues across the UK physical and digital retail markets.
The report shows that with £1.25bn spent on game development in the UK, employment in the sector is at record levels, with 16,140 FTEs directly employed in development and publishing roles, contributing over £1.35bn in GVA. The strength of UK games companies was also demonstrated in the significant inward investment to the industry, with at least £1.75bn of overseas investment throughout 2015-2017.
Now supporting £389.9m of UK development spend (or 31 per cent of the total amount spent on development), the Video Games Tax Relief (VGTR) continues to prove itself to be an important economic driver of innovation and cultural creativity. With £45m paid out in relief in 2016, VGTR-supported games provided 9,240 jobs across the industry, including 4,320 FTEs in game development (or 31 per cent of the UK development workforce).
The success of VGTR games directly contributed £294.1m in GVA to the UK economy, rising to £525m including indirect and spillover impacts. The report also shows that without VGTR support, 68 per cent of VGTR-supported games would not have been made in the UK. With £156.0m generated in tax revenue from VGTR-supported games, this means that every £1 invested into the games industry via VGTR generated an additional £4.00 in GVA for the UK economy. Of all the screen sector tax reliefs, VGTR delivered the highest rate of labour productivity in 2016 at £83,800 (compared to the UK average of £62,100).
The ‘Screen Business’ report also reveals the economic contribution of the fast-growing UK esports industry for the first time, showing that in 2016, UK esports provided job roles for 470 FTEs across a sector already generating £18.4m in GVA. The economic contribution of the digital retail sector was also shown for the first time, with 660 FTE positions contributing £49.1m in GVA.
Dr Jo Twist, Chief Executive Officer of Ukie, says: “The ‘Screen Business’ report shows once again that the UK games industry is an economic, cultural and technological powerhouse. Ukie played a lead role in producing the report, establishing further clear evidence of the size, scale and creative output of games businesses in the UK. The report also makes clear the vital role that Video Games Tax Relief has played in the continued growth of the UK games sector and in providing confidence and certainty to the market and we look forward to its continued influence.”
Simon Gardner, Chief Executive Officer of Climax Studios, says: “Video games tax relief has helped build a compelling case for the development of games in the UK. The tax credits allow UK developers to be very competitive in a global market, but also help them mitigate some risk on games they develop themselves.
From our perspective, this has led to a rise in head count, stronger order books going forward and a plan to further grow the studio. This then obviously feeds back in the taxes paid by our skilled employees, our company and the money they spend in the community. The government should continue to stimulate the video games sector, especially as it is so mobile and exports its work around the world digitally - which inherently has a low environmental impact.”
Frank Sagnier, Chief Executive Officer of Codemasters, says: “The UK has a rich history in video games and some of the best creative talent in the world. Video Games Tax Relief has undoubtedly helped us invest more in people and technology to increase our competitiveness in the global marketplace, and ultimately make better and more successful games.
“We have the skills and desire to be the best place in the world for making games and to make a significant contribution to the economy as a result but will need continued and further support if we are to achieve this, particularly in the current uncertain environment.”
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About UK Interactive Entertainment (Ukie)
Ukie (UK Interactive Entertainment) is the only trade body for the UK's games and interactive entertainment industry. A not-for-profit, it represents businesses of all sizes from small start-ups to large multinational developers, publishers and service companies, working across online, mobile apps, consoles, PC, esports, VR and AR.
Ukie aims to support, grow and promote member businesses and the wider UK games and interactive entertainment industry by optimising the economic, cultural, political and social environment needed for businesses to thrive.
Ukie works closely with the sector to influence government and decision makers, lobbying successfully for the 2014 Video Games Tax Relief, the UK Games Fund, and the Next Gen Skills campaign which resulted in a new Computer Science Curriculum. Ukie makes connections for businesses and help them access the opportunities a digital economy offers, via a successful International Trade programme, running UK Games Industry stands at the biggest international industry events.
It promotes the industry by working with the media to raise awareness of the sector’s positive cultural and economic contribution, as well as the societal benefits of games. Ukie runs askaboutgames.com, where families can learn about safe and sensible online practices, parental controls and age ratings.
Ukie’s skills work serves to increase inclusion and diversity, advocating a STEAM approach to education. Initiatives include the Digital Schoolhouse (DSH), Video Games Ambassadors (VGAs), a Student Membership scheme, and a professional development programme.
Ukie commissioned the Blueprint for Growth report in 2015, an independent review of the UK games industry with recommendations for decision makers in Parliament for how the industry can grow.
In 2016 Ukie partnered with Film London to deliver Games London, a ground breaking new three-year programme to promote the UK as the games capital of the world, the focal point of which is the annual London Games Festival.