The pound has been on a bit of a rollercoaster over the past month. Despite rallying after a hitting low against the US dollar of $1.03 in September, it remains significantly lower than the 2022 high of $1.37 seen in January.
Headlines from across the media certainly make this sound very worrying. While there are challenges to the current financial situation, it’s not all bad news for the UK film and television industry.
As the pound weakens against the dollar, inward investment from colleagues across the pond could provide a significant boost as US production companies seek cheap overseas filming locations. How could this impact the industry as a whole, and what does it mean for your creative business?
The UK is a world-leading producer of film and television and is already a top choice for US companies looking to create ground-breaking productions. Despite the challenges faced during the Covid-19 pandemic, investment looks to have bounced back quickly.
The British Film Commission (BFC) reports a more than £4.713 billion inward investment spend on film and high-end TV in the UK in 2021. This is double the level seen in 2020, showing just how popular the UK already is as a filming location for many overseas producers.
A slump in the value of the pound against the dollar might be good news for US production companies looking to film their projects in the UK.
Alongside the existing tax breaks, the weakened pound means the cost of UK productions may be even lower. On 1 January 2022, a $1 million budget would have bought £739,000 in the UK, but as of 13 October 2022 the same budget would buy £893,695 here.
That’s a significant increase in buying power for US investors. With Hollywood Reporter describing a backdrop of rising production costs in the US as a result of inflation, this increased buying power will be a welcome development for US production companies and UK businesses alike.
The rise in popularity of streaming services such as Netflix, Disney+, and Amazon Prime has driven the need for production companies to create more content. Coupled with the financial incentives to film in the UK, this creates a perfect storm for an exceptional level of growth in this sector of the UK economy.
Speaking to the Guardian, BFC chief executive Adrian Wootton explained: “It is kind of full tilt here in the UK and the demand curve is strong. We could go to £7 billion or £7.5 billion inward investment annually by 2025, and that is not including increases in spend by the domestic TV and film market [£870 million in 2021].”
With a tidal wave of projects and investments set to hit the UK in the coming years, expanding capacity is a priority for everyone in the industry. The creation of new facilities as well as the expansion of existing ones will be vital for this.
The British Film Institute conducted a review into the training and skills development that will be required in the coming years. They found that up to 20,770 additional full-time employees will be needed by 2025, along with an overall training investment of over £104 million a year.
While the prospect of rapid growth in the industry is excellent news for the UK economy and for individual businesses alike, it does present new challenges too. It’s important to embrace these new creative challenges, but to do so without protecting yourself is likely to lead to unexpected costs that could be crippling.
Whether you are expanding your facilities, growing your team, or investing in state-of-the-art equipment to help you stand out from the crowd, having the right insurance in place will keep everything safe and sound.
It might be a little while since you last reviewed the cover you have in place. As businesses grow, change can happen at a fast pace. That’s why we always recommend checking in with your insurance broker at regular intervals so that you can focus on what you do best with complete peace of mind.
If you want to know what types of protection you should have in place as you prepare for the rapid growth of the film and television industry, we can help.