A recent change in trends shows that mass firing in the tech industry is also impacting the video game industry.
A game launch is no longer the single biggest factor in an employee’s job security in this industry anymore.
The industry’s deeper integration with big tech means more dependence on advertising, plus new models for game development means more stock of games and not enough demand.
Recent tech layoffs include Microsoft which announced 10,000 job cuts including some at 343 Industries, the company behind 2021’s Halo Infinite, and Bethesda Game Studios, maker of the upcoming Starfield.
League of Legends developer Riot Games, owned by China’s Tencent Holdings Ltd., laid off dozens in its publishing, recruiting and esports departments, according to esports reporter Jacob Wolf.
Game engine company Unity Software said this week it’s letting go 284 employees in its second round of downsizing in less than a year, slashing its sports and live entertainment division. And in December, Israeli gaming company Playtika Holding Corp. laid off more than 600 employees.
The tech industry has announced plans to shed more than 100,000 jobs in the past few months. Executives at Amazon, Microsoft, and Google parent company Alphabet have all sent contrite emails to staff.
“I don’t think this is a game thing. I think this is a tech thing,” says Michael Pachter, an analyst at Wedbush Securities who follows the gaming industry.
While previously the gaming industry was seen as recession-proof, recent data contradicts that idea.
“Games are not a recession-proof industry,” says Laine Nooney, Assistant Professor of Media Industries at New York University. “Games are really reactive to markets.”
Despite the recent bad news, things could look better this year with the most stacked game release lineup- which includes One Piece Odyssey, Persona 3 Portable, Persona 4 Golden, Age of Empires 2: Definitive Edition– this year.