FromSoft Boosts Pay Amid Layoff Surge

FromSoftware has made a bold move by increasing the starting salaries of new graduate hires, standing in stark contrast to the widespread layoffs affecting the gaming industry in 2024. Dive deeper into FromSoftware's decision and the broader context of layoffs within the gaming sector.

FromSoftware Counters Layoff Trend with Salary Increase for New Hires

Starting Salary for New Hires at FromSoftware Increased by 11.8%

Amidst the troubling trend of layoffs sweeping through the video game industry in 2024, FromSoftware, the renowned developer behind hits like Dark Souls and Elden Ring, has taken a different path. The studio has announced a significant boost in starting salaries for new graduate hires.

Starting in April 2025, new graduates at FromSoftware will see their monthly starting pay rise from ¥260,000 to ¥300,000, marking an impressive 11.8% increase. In a press release dated October 4, 2024, the company stated, "At FromSoftware, we strive to make games that convey emotion, create value, and inspire joy. To this end, we are working towards stable income and a rewarding work environment where our employees can apply themselves to development. This increase in base and starting salaries is one implementation of this policy."

This move comes after FromSoftware faced criticism in 2022 for offering wages lower than many of its Japanese counterparts, despite its global acclaim. The average annual salary at FromSoftware was reported to be around ¥3.41 million (approximately $24,500), which some employees felt did not adequately cover Tokyo's high cost of living.

The salary adjustment aims to align FromSoftware's compensation more closely with industry standards, following the lead of companies like Capcom, which plans to increase its starting salaries by 25%—from ¥235,000 to ¥300,000—by the start of the 2025 fiscal year.

Video Game Industry Layoffs Ravage the West, But Japan Stands Strong

2024 has been a challenging year for the global video game industry, with layoffs reaching unprecedented levels. Major companies have cut thousands of jobs as part of restructuring efforts. However, Japan has largely managed to avoid this trend.

This year alone, over 12,000 game industry employees worldwide have been laid off, with companies like Microsoft, Sega of America, and Ubisoft making significant cuts despite reporting record profits. The total number of layoffs in the gaming sector has already surpassed the 2023 total of 10,500 employees, and the year is not yet over. While Western studios often cite economic uncertainty and company mergers as reasons for these reductions, Japanese game companies have adopted a different strategy.

Japan's stable employment landscape is largely due to its stringent labor laws and a corporate culture that values long-term employment. Unlike the "at-will employment" system in the United States, which allows companies to dismiss employees for almost any reason, Japan has robust worker protections. These include the principle of unfair dismissal, which limits arbitrary terminations, making mass layoffs more difficult.

In addition to FromSoftware, other major Japanese companies have also increased their starting salaries. For example, Sega raised wages by 33% in February 2023, while Atlus and Koei Tecmo increased theirs by 15% and 23%, respectively. Even amid lower profits in 2022, Nintendo committed to a 10% pay hike for its employees. These increases are likely in response to Japan's Prime Minister Fumio Kishida's push for wage hikes to combat rising inflation and improve working conditions.

However, the Japanese gaming industry is not without its challenges. According to The Verge, many developers in Japan face grueling work hours, often working 12-hour shifts for six days a week. Contract workers, in particular, are at risk, as their contracts may not be renewed without technically counting as layoffs.

While 2024 has been a grim year for video game industry layoffs globally, Japan has largely managed to avoid the brunt of these cuts. As we look to the future, the gaming community will be watching closely to see if Japan's approach to protecting its workforce can continue to hold strong against mounting global economic pressures.