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Wellington: The $3.5 billion screen industry that could

7 Dec 2018

With the latest Wellington-made Hollywood blockbuster Mortal Engines about to be unleashed, a new report has revealed some of the stunning figures behind the region’s powerhouse screen sector.

While Wellington is often considered the heart of New Zealand’s screen industry, home to the Weta Group of Companies, filmmaking luminaries including Sir Peter Jackson, Fran Walsh, Philippa Boyens, Sir Richard Taylor, Tania Rodger and an array of other talent, its impact on the economy and the massive flow-on effects it generates often goes unnoticed.

Prepared by the New Zealand Institute of Economic Research for WREDA, the new economic impact report found that between 2013 and 2017 the industry generated $3.5 billion in gross revenue. In 2017 alone, Wellington generated $705 million with $449m earned through post-production.

The lucrative post-production work is perfectly illustrated in Mortal Engines, a spectacular VFX-heavy production entirely filmed and produced in Wellington.

WREDA Destination and Development General Manager David Perks says the economic impact of the screen industry has substantial flow on effects to the wider economy.

“It injects hundreds of millions of dollars into Wellington with money flowing to small businesses like caterers and carpenters, but also restaurants, retail, real estate and leisure activities. The industry supports significantly more jobs than those it directly employs. 

Perks says having such a large screen industry somewhere small and relatively isolated like Wellington might seem unusual but in fact makes perfect sense.

“Our compact geography, creative workforce, world-class facilities and our general lifestyle makes filming screen projects in the region much easier than in other locations. And the New Zealand Government’s incentive scheme ensures we can compete with other global film destinations.

“We should be really proud of our industry. The roll call of productions Wellington has been behind, including Avatar, Lord of the Rings and Hobbit trilogies, visual effects for all three Planet of the Apes and Jungle Book movies, King Kong, Ghost in the Shell, What We Do in the Shadows, Wellington Paranormal, Mortal Engines and Daffodils, is eye-wateringly impressive.

“But it’s the people not the place who have made it so successful. We have so many talented creatives in the industry who call Wellington home. They could work anywhere else in the world – but they choose to stay in Wellington. Of course, there’s the names most people know - Sir Peter, Sir Richard, Fran, Philippa, Tania, Bret McKenzie and Jemaine Clement but there’s also so many other people right at the top of the game globally like Joe Letteri, Gino Acevedo and Greg Ward that are less familiar.”

While Auckland generates the largest proportion of screen revenue, the majority of this comes from television broadcasting and production.

“TV is a growth area for Wellington, as demonstrated by the series Wellington Paranormal. We’d love to see more productions choose Wellington as their base,” says Mr Perks.

To illustrate just how important the screen industry’s wider contribution to the Wellington region is and how its economic benefits ripple out across different sectors, the report modelled a 50 per cent decrease in its revenue.

It showed the Wellington economy shrinking by almost $150m, with spending plummeting by over $120 per person. Household spending, which is the proxy for well-being, dropped by $64m. With the export-orientated nature of the industry, international exports would decrease by $96m and about 460 jobs would disappear.

Any contraction in the screen industry would also have flow-on effects to other industries, with leisure and other cultural activities the most effected, experiencing a $23.6m drop. Real estate and construction would also be heavily affected.

According to the report, the region’s screen sector generates about 20 per cent of the New Zealand screen industry’s revenue, with 70 per cent of the country’s post production earnings coming from the capital.

It’s estimated that about 2500 people were working in the screen industry in Wellington in 2017. The sector has grown substantially since its early days, with dozens of companies such as Wrestler, Avalon Studios, Production Shed.TV, Storybox, Scale Studios and CKFilmDesign all contributing to the rich ecosystem.

Wellington Paranormal producer Paul Yates, who makes up one third of film company the New Zealand Documentary Board alongside Jemaine Clement and Taika Waititi, says 20 years ago the screen industry in Wellington was small, but it has since morphed into one of the top five technological places to make films in the world.

“Wellington’s unique as a film destination because it’s small enough to feel like a small town but big enough to feel like a city at times. For a destination to make films the people and technology are second to none, but as a destination it’s fantastic because within 20 minutes you can be in farmland, you can be in the bush, you can be in a city space that could be anywhere.”

While a vibrant array of companies make up the region’s screen sector more than half of those employed in the sector work for Weta Digital, one of the world’s leading VFX companies and the largest screen company operating in the New Zealand industry.

Weta Digital is at the heart of the Weta Group of Companies which also includes Weta Workshop, Park Road Post Production, Stone Street Studios, Portsmouth Rentals and Wingnut Films.

Weta Digital Chief Operating Officer David Wright said the core economic benefit remains providing employment and career opportunities for Kiwis across the film-making companies.

“We are proud that more than 2,000 people work across the Weta Group on the Miramar Peninsula and that number can increase when major productions are being filmed here. Those crew members who live and work here not only support their families and spend their time, money and invest their talent in Wellington, but they attract cutting edge film work to New Zealand because our people are so well regarded in the international industry.

 “We are supported by a whole of community of people and businesses from hardware stores to computer providers, hotels to car rental firms which service and are supported by the film projects  developed here. We also have an eco-system in Wellington which sees talented people spin off from places like ours at Weta Digital to create businesses of their own,” says Wright.

When it comes to tourism, the screen sector, particularly Hollywood blockbusters such as Lord of the Rings and The Hobbit, have had a massive impact on New Zealand.

The economic impact of The Hobbit trilogy was previously estimated to have increased household welfare by $268.2m, increased international visitor spending by $1.11b and increased tourism-related industry exports by $861.3m.

The report was unable to adequately measure the tourism impact of Wellington’s screen industry on the regional economy, but figures provided by the Weta Group of Companies show the number of paid visitors on the Weta Studios Tours at Weta Workshop in Miramar has continued to increase every year, rising from 48,873 in 2013 to 149,579 to 2017.