The stiff economy is taking its toll on the US video game industry, with sales falling 31% to $1.17 billion during June. Research group NPD has recognized this as the industry’s largest decline since 2000. According to Anita Frazier, an analyst at the firm, this was one of the first months where the economy clearly affected sales figures.

Video game software sales declined 29% to $625.8 million, with hardware sales dropping 38% to $382.6 million. Gaming accessories also fared poorly, with controllers and other add-ons dropping 22%. The firm says Activision Blizzard’s Prototype sold more than any other title in June, moving 419,900 units. THQ’s UFC 2009: Undisputed reportedly came in second place, shipping 338,300 units.

Frazier continued by saying that this level of decline is going to cause some pain and reflection in the industry. However, she added that the first half of this year has been tough largely due to comparisons against a stellar first half last year. Analysts believe that the industry will dust itself off as the year unfolds, and that console price cuts wouldn’t hurt.

As wallets grow lighter, consumption will inevitably slow in any industry. Though, I think (as I know many of you do) that the lack of quality releases lately has definitely played its part. If you build it - and it doesn't reek - they will come.