Yet another argument for statewide tax reform. The one industry that is actually growing in this shrinking economy won’t be growing in the Empire State.

New York City is missing out on an opportunity to cash in on one of the most lucrative segments of the entertainment industry, according to a study by the Center for an Urban Future released Monday. The video game industry is expected to explode over the next few years. The worldwide gaming market was worth $37.5 billion last year and is expected to grow at a rate of nearly 10% over the next three years.

The industry is creating thousands of new jobs, but the Big Apple lags far behind San Francisco, Seattle and Montreal. Technical talent is crucial to fueling the industry, but a majority of New York’s computer programmers work in financial services. In addition, most local video game firms are small and can’t afford the high costs of doing business in the city. Like most small businesses in New York, video game firms struggle with high office rents and labor costs. Most companies surveyed say the city should offer tax incentives for creating jobs and setting up shop in New York.

Source: Crain’s New York Business