The video games industry is currently navigating a tumultuous period, with nearly 36,000 job losses reported since 2022. From major platform holders to small indie studios, no company seems immune to the wave of redundancies. Just last week, Microsoft announced another substantial round of layoffs, including studio closures and project cancellations, prompting concerns about the industry’s future stability.
Despite these challenges, the sector still sees significant commercial successes. Ubisoft’s latest “Assassin’s Creed” installment was a digital bestseller, while Microsoft enjoyed triumphs with titles like “Indiana Jones” and “Doom: The Dark Ages.” Even less mainstream games such as the “Death Stranding” sequel and “Clair Obscur: Expedition 33” have garnered both critical acclaim and commercial success. Meanwhile, NetEase’s “Marvel Rivals” achieved impressive player numbers at launch, though these have since waned.
Understanding the Layoff Phenomenon
While the reasons behind these layoffs are multifaceted, this article examines how the games industry engages its workforce compared to the film and TV sectors. Are there lessons to be learned from these industries that could mitigate the pain of layoffs?
No Safety in Success
“Marvel Rivals” was a commercial hit upon release, yet many staff members were laid off immediately after its launch. One director remarked,
“This is such a weird industry…My stellar, talented team just helped deliver an incredibly successful new franchise in Marvel Rivals for NetEase Games…and were just laid off!”
Unfortunately, this scenario is not uncommon, with teams behind successful projects often facing redundancies. The surprise and dismay within the gaming community are understandable, as it’s difficult for those who have worked hard on successful projects to face job losses.
The core issue lies in the production cycle. Once a game is released, the need for a large production team diminishes significantly. Unless there is another project ready for these employees, their roles become redundant. This is even more pronounced when projects are canceled mid-production.
Comparing Development Cycles: Games vs. Film and TV
The production cycle for video games is often more unpredictable than that of film and TV. While film and TV projects maintain consistent resource levels from greenlight to wrap, video game development can be a rollercoaster. Teams typically start small and expand as development progresses, peaking just before launch. The development periods for major games can span four to five years, much longer than the typical one-year cycle for film or TV production.
Both sectors face reduced resource needs once a project wraps. However, in film and TV, the workforce is accustomed to moving on to the next project, often as freelancers. This expectation helps avoid the large-scale redundancies seen in gaming.
The Status Divide
In the gaming industry, most employees, especially in AAA studios, are permanent staff. This provides job security and benefits but creates an expectation of ongoing work that doesn’t align with the cyclical nature of creative projects. In contrast, film and TV professionals are often freelancers, aware that their roles are temporary and accustomed to seeking new opportunities post-project.
If film and TV operated like the gaming industry, they might face similar headlines. The flexibility of their staffing model helps mitigate this issue. Could the gaming industry adopt a similar approach?
Exploring New Employment Models
Is there potential for more games production to be resourced through freelance or fixed-term contracts? While this might not be viable for all projects, it could be considered for some. Long-term relationships with developers are crucial for continuity, given the lengthy development cycles in gaming.
Legal challenges also arise with a freelance model. The extended development periods could lead to staff being classified as employees, complicating tax and employment status. However, adopting a middle-ground approach, such as fixed-term contracts or designating workers as ‘workers’ rather than ‘self-employed,’ could offer flexibility without sacrificing benefits.
By clearly communicating project-based employment terms, studios could better align workforce expectations with project needs, potentially reducing overstaffing and severance costs. Offering competitive wages and incentives for project completion could maintain positive staff sentiment and encourage team members to seek new projects proactively.
Balancing Change and Stability
Permanent roles will always have a place in the gaming industry, particularly for senior positions or roles critical to a studio’s success. However, exploring more flexible employment models could benefit certain roles, especially during project planning stages.
These changes should not be seen as diminishing employment rights but rather as a means to create a more sustainable industry. As the gaming sector continues to innovate in gameplay, it may also need to innovate in workforce management to ensure long-term viability for both current and aspiring industry professionals.
For an industry constantly seeking new ways to play, why not also explore new ways to work?
