Toys and Games
The United States is the largest market for the entire industry, making up 50 percent of the global traditional toy market. The retail market for toys in the U.S. was $35 billion in 2019, according to the market research group IBISWorld. The U.S. also leads the world in toy development as well as in the marketing, advertising, and promoting of toys. In addition, American toy makers are known for invention and design, and their toys are extremely popular abroad.
The coronavirus pandemic, which started in Wuhan, China, in late 2019, impacted the toys and games industry in 2020, with business closures and social distancing requirements causing an economic slowdown. The industry experienced supply chain disruptions early in the pandemic as a large portion of imports are from China. In spite of this, the U.S. toy, doll, and game manufacturing industry was projected to have slight growth, about 1.2 percent, from 2015 through 2020, mainly due to the continued export of industry products. The accelerated distribution of the COVID-19 vaccine is expected to bolster the economy in 2021. Despite this a decline in revenue is predicted for the toy, doll, and game manufacturing industry through 2025. Increasing competition from low-cost imports coupled with a shrinking number of retailers will contribute to decline in this sector.
The stay-at-home mandates helped families spend more time together and many of them spent that time playing games together. The Toy Industry foresees that trend continuing in 2021, with families seeking educational toys and activities, family games and puzzles for all age groups, outdoor and active toys, nostalgic brands, cooking-themed and role play toys, and more. Many toys and games will be influenced by social media trends and other fads. Social media platforms such as TikTok and YouTube will also inspire the growth of toys that get kids moving and dancing. There will also be an increase in toys that promote mindfulness and comfort, such as plush toys and dolls.
Toy sales in 2019 were $27 billion, a 4 percent decrease compared to the previous year's sales, according to a report by the Toy Industry Association. Categories that remained somewhat stable or that experienced growth in 2019 included action figures and accessories, arts and crafts, and games and puzzles. The categories that experienced declines in sales included building sets, dolls, explorative toys, preschool toys, vehicles, and youth electronics. Today, most toys sold in the United States are no longer produced in this country. Thus, while toys and games remain a major U.S. industry, the outlook for new jobs is not entirely positive.
The Bureau of Labor Statistics predicts that industrial designers, who create products such as toys, will experience 3 percent employment growth through 2028, which is slower than the average for all occupations. Designers who have strong knowledge of computer-aided design and computer-aided industrial design will have the best chances of securing work. Multimedia artists and animators, including video game designers, are expected to average employment growth through 2028, at a rate of 4 percent. There will be steady demand for more realistic video games and visual effects, and job opportunities are also expected to increase for game and application designers for mobile devices.
Another reason for the toy industry decline is the trend away from traditional toys and games and the overwhelming popularity of interactive, computerized toys. The majority of these, like traditional toys, are manufactured overseas. Another factor linked to the decline in toy sales is the economy. During rocky economic times, people conserve money and scale back on purchases. Recently, the economic slowdown due to the coronavirus pandemic has contributed to the decline in the global doll, toy, and game market. According to a market research report, the global doll, toy, and game market is projected to decline from $102.6 billion in 2019 to $101.7 billion in 2020, at a compound annual growth rate of -1 percent. As the economy stabilizes, consumers will be more comfortable spending money on toys and games. The global doll, toy, and game market is expected to recover post-pandemic, growing by 9 percent annually from 2021, to reach $128.5 billion in 2023.
The U.S. Census Bureau forecasts an increase in the population of children aged 0–17 between 2014 and 2060, which can help increase toy sales. The population of adults aged 18–44 is also expected to increase steadily by 2060, which will contribute to increased revenue in video game sales. Also, the growing world market, which some analysts expect to eventually comprise up to 50 percent of revenue, will have a positive bearing on the toy industry. Internet retailers may be able to reach more customers with a wider variety of products than that available in stores, but it's not yet certain how online sales will affect the entire industry.
The video game industry has experienced an increase in revenue during the coronavirus pandemic due to the lock-downs and stay-at-home orders. Many people have been home, with more time on their hands, looking for new types of entertainment. Companies such as Activision, Microsoft, Nintendo, and Twitch have experienced tremendous growth during the pandemic, with large increases in subscribers to their games, devices, and accessories. Video game sales in March 2020 alone were $1.6 billion, a year-over-year increase of 35 percent. Game subscriptions may drop once more businesses reopen and people return to work, but the long-term effects of the pandemic on the toys and games industry is still to be determined. Many video gamers have switched to mobile devices and social media platforms, contributing to the decline in sales of physical games. New gaming consoles are frequently introduced, such as for Xbox and Playstation, which can create more job opportunities for video game professionals.