Games Industry Outpaces US Economy


The Entertainment Software Association released the report Tuesday, Videogames in the 21st Century: Economic Contributions of the US Entertainment Industry.

The report, penned by Stephen E. Siwek, a principal at research firm Economists Incorporated, stated US videogame software industry growth exceeded 17 percent on an annual basis during 2003-04 and 2005-06. This is compared to US economic growth of less than 4 percent for the same years.

The US entertainment software industry’s value added to US Gross Domestic Product was $3.8 billion.

“Unlike many other industries, the US entertainment software industry disproportionately adds to real growth in the US economy,” the report stated.

US retail sales of videogames and computer games exceeded $7 billion in 2005, a figure that has undoubtedly increased up to this point. In 1996, videogame software sales were just $2.6 billion. Unit sales grew from 74.1 million in 1996 to over 250 million in 2006.

The report said that the overall US entertainment software publishing industry directly employs over 24,000 in 31 states, with average compensation per employee (including wages, salaries, pensions, insurance, etc.) of $92,000 in 2006. Breaking the numbers down further, in game publisher or publisher/developer firms, the average compensation per employee was $113,000. In game developer firms, the average compensation per employee was $77,000, according to the report.

Total compensation that year was $2.2 billion.

Nearly 10,000 of the total number of directly employed workers are at game publishers, while around 14,000 work directly for US-located game developer firms.

Direct employment grew at a rate of 4.4 percent annually in 2002 through 2006 for the US software publishing industry.

California leads the way in direct employment with 40 percent of total industry workers with over 9,000. Washington is a distant second with around 2,600 (11 percent), Texas has 2,200 (9 percent), New York has 1,500 (6 percent), Massachusetts has 1,000 (4 percent) and Illinois has less than 1,000 (4 percent), rounding out the top six states, which make up around three-quarters of total employment. In 2002, the industry employed less than 20,200 workers.

Combined direct and indirect employment of the industry (which includes employees whose jobs depend on videogames) is 80,000.

The ESA report also said International Game Developers Association membership grew from 2,500 in 2002 to nearly 11,000 in 2006.

Compliments of: Next Generation



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