Interactive Investor

Creative industry growth outpaces all others

3rd March 2015 08:56

Lee Wild from interactive investor

Britain's creative industries span a multitude of disciplines. Film, fashion, music, design, marketing and advertising are among the most obvious, but the government has been rather helpful and provided a broad definition of what is included.

According to a government report entitled Creative Industries Mapping Documents 2001, creative industries are "those industries which have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual property".

All are especially lucrative. "They are one of our most powerful tools in driving growth, outperforming all other sectors of industry and their contribution to the UK economy is evident to all," says Sajid Javid, secretary of state for culture, media and sport.

Indeed, according to figures published earlier this year by the Department for Culture, Media & Sport the industry chipped in almost £77 billion to the UK economy in 2013. That's up 10% year-on-year and was more than three times faster than the wider economy and higher than any other industry.

Obviously, a lot of services provided by the creative industries generate exports - £17.3 billion in 2012, almost 9% of all UK service exports.

Creatives also accounted for 1.7 million jobs, or about 5.6% of all jobs in the UK. And recruiters are being forced to pay more for the right talent. An annual salary survey by industry recruiter Major Players revealed sector pay rising at 10% and plenty of promotions in all areas.

"Most agencies we work with are recruiting, whether immediately, or in the near future, and also the demand for talent is high," says the agency.

In 2014, there were many highlights, notably new international licence deals signed by British publishers, Pinewood Studios launched in Hong Kong, and UK creative exports to Brazil from the design, film, TV and games industries.

This year should be equally eventful. More smaller ad agencies are expected to branch out overseas, as are the digital start-ups that are now outgrowing the Shoreditch nest. Interestingly, UK dramas like Sherlock and cooking programmes are becoming increasingly popular in Japan, reckons Akiko Yanagisawa, Senior Trade Adviser, UKTI Japan.

And this is clearly good news for the companies involved. The media sector is up 12% already in 2015, twice as much as the FTSE 350. And all of the listed companies featured on our Creative Digital and Media page have a solid history of share price performance. Over the past five years, the six - YouGov, Brainjuicer, Cello, Next Fifteen, The Mission Marketing Group and St Ives - have risen an average 174%. St Ives has almost tripled.

If international expansion goes well, and the signs are encouraging, the next five years should bring further rewards.