Developer trade association TIGA has said that the UK development workforce could shrink by a quarter between 2010 and 2015 if the government doesn't implement cultural tax relief for the sector.
The latest estimates come from a renewed push by TIGA as it submits an updated 85 page document to the government calling for cultural tax breaks.
According to the research, such relief could create and safeguard 3366 development jobs and £431 million investment. Headcount has fallen by 9 per cent in the UK since 2008 - when TIGA first submitted its case to the then Labour government.
"If the coalition government is serious about its intention of rebalancing the economy then it should invest in the UK videogames industry by introducing a tax break for games production," said CEO Richard Wilson.
"Games tax relief would create jobs, boost investment and generate much needed tax revenue for the government. The coalition government recognises the effectiveness of tax breaks because it already supports the UK film industry with a tax credit. It should adopt the same successful policy for the video games industry to enable our sector to make a powerful contribution to UK economic growth."
While TIGA continues to campaign for tax relief on behalf of the development community, the publishing sector adopts a more pragmatic approach - EA's Keith Ramsdale recently told GamesIndustry.biz that the government isn't likely to help out UK development during the current economic climate.
"We're not going to suddenly be handed a great big tax relief bill when the government's facing the economic issues it is - I think that cuts to the chase on this. The conversations we've had with government are pretty clear on this," he said.
The division between publishers and developers has been cited as one of the reason why the government is not aiding the sector, as TIGA and UKIE are unable to present a united front.
TIGA believes that cultural tax relief would create around 1328 new jobs over five years in the development studio sector, increasing investment in studios by £138 million. It also claims 2427 "indirect jobs" would be created with annual tax revenues rising by £126 million and a contribution to GDP of £307 million.
Cultural tax relief could save a further 2038 direct jobs and 3726 indirect jobs, £293 million in development expenditure, £267 million in tax revenues and £649 million in GDP contributions according to TIGA estimates.