The Association for UK Interactive Entertainment (ukie) is the UK trade body that represents games companies along with other interactive entertainment creators. They recently published research on the likely effect of Brexit on the UK gaming industry and the results are concerning if not disturbing.
This research was produced directly from surveying ukie member companies so it’s fair to say that it reflects the current general thinking in the British gaming industry, but it’s also worth noting that Brexit is a very uncertain process. Prime Minister Theresa May started today by triggering Article 50 of the Lisbon Treaty – the formal request to leave the EU.
- 51% of the ukie members say that they want to stay in the UK, but 40% said that they would relocate to another country if they can see that Brexit is impacting their business.
- 23% of British games companies said that they have already been approached by representatives of EU countries and cities offering to help them to relocate. This is no surprise of course.
The news isn’t all gloomy for companies exporting products and services from the UK. Since the EU referendum last June the value of the pound has plummeted, meaning that British companies are finding it much easier to export. In fact a recent prediction from Deutsche Bank suggests that the pound may collapse a further 15% this year.
But even though it’s cheaper to export, games companies rely on intellectual talent. 38% of the companies surveyed said that they are finding it harder to attract and retain talent because of Brexit.
This is no surprise. Why would German, Dutch or Italian software developers want to relocate to the UK at present when there are other opportunities in the EU and the UK is offering no guarantees on who will be able to stay in the country once the exit process is completed in 2019?
As a whole, the companies featured in the research have 34% of their employees from other EU nations and a full 57% of the companies actively hire from the EU. To remove this talent pipeline is going to be an enormous challenge for companies that need a steady supply of creative talent.
In my opinion, it’s not so much that Brexit is directly damaging the games industry, it’s the uncertainty around Brexit. If the British government offered a guarantee to EU citizens living in the UK that they could remain after Brexit and then a points-based visa system was applied to ensure the UK attracts highly talented migrants then I’d expect the UK-based companies to feel much more secure. The highly skilled people they are hiring are almost certainly capable of passing any future migration test so the real issue is the uncertainty over these next two years of negotiation.
Will the UK government offer some certainty? I doubt it, but maybe they will offer the British games industry a welcome surprise?
Click here to download the complete ukie report on Brexit.
Photo by Bankenverbad licensed under Creative Commons.