Earlier this week, the UK Government announced it would change rules regarding who is able to enter the UK to live and work. One of the standout points of these changes is an increase in the minimum salary needed to get a skilled worker visa, which will go up from £26,200 to £38,700.
The UK’s games industry trade body, Ukie, spoke out regarding the changes and how they could negatively impact the gaming industry at a time when UK game developers are already stating they are suffering from a skills shortage.
In this post, Matchingham Games CEO and founder Faith Haltas gives his take how the increased salary requirement will impact the UK games market and potentially scare away new talent.
The UK’s mobile gaming market is booming. This is no surprise given that its tech sector leads the European market. It’s easy to assume that the foundations on which this success was built are strong. But this week, the Government cracked a pillar that’s propping up the sector, introducing migration legislation that will lock out tech talent.
James Cleverly announced on Monday that the Government is raising the minimum salary needed to get a skilled worker, such as a software developer, into the country from £26,200 to £38,700. There’s already falling investment, a lack of deal flow and a talent crisis in the mobile gaming industry. And the Prime Minister’s decision risks compounding these problems.
UK tech investment is lagging behind the European average (Data Commons). In Q3, UK gaming largely missed out on a highly lucrative spate of M&A activity worth $316 million (Drake Star).
Bad business
Founders choose to set up their businesses here because the designers, coders and developers are the best.
Fatih Haltas
If, like me, you run a UK-based game developer, stats like this make you feel uneasy. But what will really keep you up at night is the talent crisis. In a recent report, the trade body (TIGA) revealed that 68% of studios have found it either “difficult” or “very difficult” to fill vacancies. And a staggering 59% said that the shortfall has hindered growth.
Overseas talent has helped to supercharge the UK gaming industry. Founders choose to set up their businesses here because the designers, coders and developers are the best. Over half of these highly skilled tech workers are from abroad (Technojobs).
The UK attracts and nurtures the very best talent from across the world. I chose to found Matchingham Games here for this exact reason – to tap into the UK’s diverse tech talent. And the broader economy has benefited from the employment and investment this brings.
Given its importance, it’s hard to see the business logic behind the recently announced new visa rules. It’s a reversion to the old UK model where the country retains IP rights but delegates the work overseas. The problem is that skilled developers from Turkey, India and Poland – rich talent pools for the UK gaming sector – will now be shut out. The new threshold will also heavily impact new graduates. Young grads from overseas are the backbone of the gaming sector. The chances of them meeting the new salary requirements are slim at best.
Businesses will also find that the cost-effectiveness of hiring within the UK sector is greatly reduced. If they can’t find UK nationals to fill positions, which is often the case, they’ll be forced to overspend on labour costs to meet the higher salary threshold. This is not financially sustainable for gaming businesses – especially startups.
Locked out talent
This is a classic example of political point scoring taking precedence over business common sense. The Government is focused on “growing the economy,” which is obviously commendable. Unfortunately, though, regarding the grave threat that the gaming sector currently faces – it’s asleep at the wheel.
For the sector to be an investment magnet, it must attract the best talent, not scare it away with stricter visa requirements.
Fatih Haltas
For years, the UK’s gaming sector has drawn in investment from across the world. Globally competitive studios have knock-on effects for the wider tech ecosystem as talent leaks into different areas, strengthening the sector as a whole. The country’s purse is a little fatter each year because of its contributions.
But for the sector to be an investment magnet, it must attract the best talent, not scare it away with stricter visa requirements. Talent will still be drawn in by the opportunity to work in the UK, but this alone isn’t enough. For inspiration, it should look overseas. Asian gaming sectors are currently thriving after surgical government support. One example is the UAE’s AD Gaming initiative, which provides support for locally developed games (AD Gaming).
Targeted interventions like this should be the bread and butter of the Government’s goal to grow its domestic tech sector. They draw in talent and investment without stifling innovation. The saving grace is that historically, the Government has changed its mind. It needs to recognise that the path to growth is through supporting established industries, like the gaming sector, not ignoring them.
The new visa requirements will leave the gaming industry out in the cold, and if Rishi Sunak doesn’t reconsider them, he risks undermining a pathway to economic growth. The UK is still the most attractive European market for game developers, and it can maintain that status. But not if we stifle the talent that helped us to get there.
About Fatih Haltas:
Fatih Haltas is an international tech investor and founder & CEO of Matchingham Games, which has achieved nearly 500 million installations. Some of his other companies have featured in the Financial Times list of fastest-growing companies and he has over 10 years of experience across all areas of mobile app & game development, including in product design & management, monetisation models and user-acquisition strategies. He now applies this expertise to his work as an angel investor, with investments in the data analytics, cybersecurity and software development sectors.
