MUMBAI: The UK film industry contributes a total of over £4.5 billion a year to UK GDP and more than £1.2 billion to the Exchequer, according to an independent report published by Oxford Economics.
The Economic Impact of the UK Film Industry – commissioned by the UK Film Council, Pinewood Shepperton, Framestore, Cinesite and Double Negative – concludes that the UK film industry is substantial, is weathering the recession well, and its long-term trend is one of strong growth and expansion.
The report also concludes that the UK’s film tax relief is vital to sustaining current levels of global competitiveness and job creation. Without the UK film tax relief in place, UK GDP would be reduced by around £1.4 billion a year. That compares with a current cost of the film tax relief of around £110 million a year, meaning that an extra £13 in GDP is generated for every £1 invested.
Minister for Culture, Communications and the Creative Industries, Ed Vaizey said, “The creative industries are a British success story. They continue to grow, and the government sees the real potential they have to help our economy in the coming years. This report is evidence of how important British film is – to our economy as well as promoting our cultural life, our identity and diversity on the international stage.”
Specifically, the report examines the many ways in which the UK film industry contributes to UK plc, including: Jobs – the UK film industry directly employs around 36,000 (up by 30% since 2000 and 7% since 2006), supporting a total of 100,000 direct and indirect jobs (up from 95,000 in 2007). Skills – the UK film industry provides jobs for some of the UK’s most highly qualified workers, with 58% of the production workforce, university educated and London having a global market share of approximately 20% in film visual effects work. Multiplier effect – for every job supported in the core UK film industry a further job is supported through indirect and induced multiplier effects.
In addition, the showing of UK films helps UK TV broadcasters generate about £245 million of revenues. Total multiplier activity contributes a further £1.6 billion a year to UK GDP and £425 million to UK tax revenues. Between 2000 and 2009, fixed capital investment in infrastructure and new technology has totaled almost £1.1 billion. In 2009 alone, capital investment in the core UK film industry is estimated to have been £147 million, with most of the investment undertaken in the production sector.
Inward investment is estimated to account for around £3.6 billion of film’s contribution to GDP and £960 million in Exchequer revenues. Exports – in 2008, UK film exports totaled around £1.3 billion. Culture – British films are important to UK audiences. A film shown in the UK can expect its box office to be up to 30% higher if it is indigenous. On this basis, UK films are estimated to have boosted the box office revenues by an average of around £60 million a year over the last decade. Tourism – films depicting the UK are responsible for generating around a tenth of revenues from overseas visitors, totaling around £1.9 billion a year.
Regional support – the film industry directly supports around 2,200 jobs in the South West of England and 2,100 in the North West. Merchandising – merchandising associated with UK films supported about 6,600 jobs in 2009 and contributed about £237 million to UK GDP and £107 million to the Exchequer.
UK Film Council chairman Tim Bevan said, that the UK film industry’s economic contribution is growing in spite of the wider challenges it faces, adding: “This report highlights the financial and cultural benefits of a vibrant British film sector, driving growth and productivity across the creative industries. With world-class film facilities, a highly-skilled workforce and effective government support, including a film tax relief that provides certainty for business, the British film industry is firing on all cylinders and is well-placed to play an increasingly valuable role helping the UK economy grow in the years ahead.”
Pinewood Shepperton Chief Executive Ivan Dunleavy said, “It’s clear to see just how important the film industry continues to be to the UK’s economy. The new coalition government has been extremely positive in recent times on issues such as the film tax credit which, along with the UK’s skills and expertise, has helped to keep the UK competitive in a global market. The industry also needs to play its part. Investment in facilities and long term infrastructure projects, such as Project Pinewood, need to continue in order for the UK to become a hub for the hi-tech digital and creative industries of the future.”