The UK’s game development industry is thriving even amid global economic challenges.
- Northern studios are leading the growth, despite a downsizing trend in the sector.
- London remains the fastest-growing hub with significant job additions.
- Freelancing is on the rise as companies adjust employment strategies.
- Overseas ownership in UK studios reaches a significant proportion.
In an era of economic challenges, the UK game development sector continues to expand, defying global trends. Despite a widespread downsizing in the industry, northern studios have emerged at the forefront of this growth. A recent report by TIGA highlights a notable increase in development activity across the UK over the past year.
While London stands out as the fastest-growing hub, with an impressive addition of 468 new staff members, regions like the North East and North West are also experiencing significant growth. North East studios have employed 280 new staff, whereas North West businesses recruited 247 new team members. Meanwhile, other regions like Scotland faced a reduction in headcount, highlighting a mixed picture of growth and contraction across the country.
The overall UK gaming sector experienced a 4.8% growth in the 12 months leading up to May 2024. Nevertheless, this marks the slowest growth rate since 2012, stressing the difficult conditions the sector operates under. Dr Richard Wilson OBE, CEO of TIGA, remarked on the remarkable resilience shown by the industry during these times. He noted that although London is a major player, nearly 80% of game development occurs outside of the capital, with areas like the North East and North West recording notable expansions.
A pivotal development in the employment landscape is the increase in freelancing roles. Between April 2023 and May 2024, the number of freelancers surged from 1,102 to 3,625. This shift largely stemmed from major companies transitioning from full-time positions to freelance assignments as part of a broader strategy to remain agile.
Despite company downsizing and closures, job creation within the sector has outpaced losses. Over 400 companies reduced their workforce by 2,353 full-time positions, yet 678 companies expanded, adding 3,932 full-time roles. However, the number of game development companies has slightly declined, signifying ongoing consolidation within the industry.
As of May 2024, the UK is home to 2,148 active game development companies, slightly down from the previous year. These include 1,697 game studios, 60 publisher studios, 109 publishers, 4 broadcasters, and 278 service companies. Notably, companies under foreign ownership now account for 62% of the workforce in the sector.
Dr Wilson emphasises the UK’s strengths in having world-renowned studios, a deep talent pool, and robust educational programmes. He underlines the importance of government support in fostering an environment conducive to growth, suggesting that enhancements to the Video Games Expenditure Credit could bolster job creation and investment.
There is a strong call to action for further enabling start-ups to scale and for continuous improvement in skill development to maintain the competitive edge. Such measures are crucial for the UK to continue leading in the gaming industry and to support the government’s broader economic objectives.
The UK’s video game sector demonstrates resilience and growth potential despite challenging economic circumstances.
