U.S. Video Game Industry’s Growth Outpaces National Economy

New Study Details Industry’s Contributions to State Jobs and GDP

NOVEMBER, 2007 – WASHINGTON, DC –The US computer and video game industry’s annual growth rate from 2003 to 2006 exceeded 17% according to a ground-breaking study released today by the Entertainment Software Association (ESA). This far outpaces the US economy as a whole which only grew at 4.0% during this same period. According to the study, Video Games in the 21st Century: Economic Contributions of the U.S. Entertainment Software Industry, the US entertainment software industry directly employs more than 24,000 individuals, with an average salary of $92,300 in 2006. The economic impact report was conducted by Economists Incorporated for the Entertainment Software Association (ESA).

“Computer and video game companies play an ever increasing role in our nation’s growing economy,” said Michael Gallagher, CEO of the ESA, which represents U.S. computer and video game publishers. “These companies and their colleagues across the nation are making entertainment software one of the fastest growing industries in the United States.”

Video Games in the 21st Century, is the first economic study to outline the specific contributions of the entertainment software industry on the U.S. economy. The report concluded that:

* The computer and video game industry’s value added to U.S. Gross Domestic Product (GDP) in 2006 was $3.8 billion;
* In 2003-04 and 2005-06, the industry’s contribution to real growth exceeded its share of GDP by more than four to one;
* The entertainment software industry directly and indirectly employs more than 80,000 people in 31 states; and,
* U.S. industry employees received total compensation of $2.2 billion.

The report states that California is the largest employer of computer and video game personnel in the nation, accounting for approximately 40 percent of total industry employment nationwide. These companies provided over $1.8 million in direct and indirect compensation to Californians last year. California’s computer and video game industry grew by 12.3 percent last year, nearly three times faster than the state’s overall growth, and added $1.7 billion to the state economy.

Other specific state findings include:

* Virginia’s computer and video game industry grew by 552 percent in 2006, more than 172 times as fast as the commonwealth’s overall growth;
* Washington state ranked second nationally in computer and video game personnel in 2006, with 9,284 direct and indirect employees at more than 59 facilities across the state; and,
* New York’s entertainment software companies directly and indirectly employ 4,415 individuals at more than 25 facilities across the state.

The ESA is the U.S. association dedicated to serving the business and public affairs needs of the companies publishing interactive games for video game consoles, handheld devices, personal computers, and the Internet. ESA members collectively account for more than 90 percent of the $7.4 billion in entertainment software sales in the U.S. in 2006, and billions more in export sales of entertainment software. For more information about the ESA, please visit www.theESA.com.