As the new year begins, some of the biggest players in the gaming industry have already announced layoffs. NPR reported that in the first two months of 2024 alone, approximately 6,500 video game employees were laid off. During the same period last year, layoffs barely exceeded 1,000.
Many are wondering why layoffs in gaming are so common, even though the gaming industry is the most lucrative entertainment industry, and why thousands of workers in this sector can lose their jobs each year. has doubts.
The generally accepted reason is the lingering effects of the pandemic. In 2020, many companies were looking for qualified workers to fill missing roles amid lockdowns. Most companies have now abolished remote working and achieved a stable workflow.
Since there are many people currently working at these companies, it appears that the easiest way to make up for lost wages is to lay off employees, especially for those hired during the height of the pandemic.
Epic Games, the developer of Fortnite, one of the world's most popular games, laid off about 800 employees in September 2023, according to The Verge. The decision raises questions about how the maker of the year's most profitable game will finally have to lay off employees.
The impact spilled over to companies outside of the gaming industry, with Epic Games' decision to lay off 16% of its workforce. Earlier this year, Epic Games acquired Bandcamp, a platform that allows fans to directly support up-and-coming bands and artists. Amid layoffs, Epic sold Bandcamp to licensing platform Songtradr.
This is just one example of a cascading wave of layoffs across industries, which even large-scale acquisitions have not prevented from surging.
Microsoft's proposed acquisition of video game company Activision Blizzard has become a notable business story of 2022, moving beyond gaming news and into mainstream media. After announcing their intentions, a deal was struck and closed at the end of 2023. One of the world's largest technology companies currently owns some of gaming's most iconic franchises, including Call of Duty, Overwatch, and Candy Crush. Despite the popular title, the company laid off 9% of its gaming division at the beginning of 2024, bringing the total to a staggering 1,900 people, according to CNBC.
Typically, acquisitions mark exciting new partnerships and result in bigger and better content for video game players, but that wasn't the case for Microsoft. The layoffs by Epic Games and Microsoft are contributing to the stigma of low job security in the video game industry.
Editor's note: Corrections have been made to the infographic. Online version of this story. I mentioned earlier that it was designed by Nathalie Anmari. Errors have been corrected and credit assigned to the illustrator. Mariagia sorgose.