FromSoft Boosts Pay Amid Layoff Trend

FromSoftware has announced an increase in the starting salaries of new graduate hires, a move that stands in stark contrast to the industry-wide layoffs affecting the gaming sector in 2024. Dive into the details of FromSoftware's initiative and the broader context of layoffs sweeping through the gaming industry.

FromSoftware Counters Layoff Trend with Salary Increase for New Hires

Starting Salary for New Hires at FromSoftware Increased by 11.8%

While the video game industry grapples with widespread layoffs in 2024, FromSoftware, the renowned developer behind hits like Dark Souls and Elden Ring, is taking a different path. The studio has announced a significant hike in its starting salary for new graduate hires.

Starting in April 2025, new graduates joining FromSoftware will see their monthly pay increase from ¥260,000 to ¥300,000—an impressive 11.8% boost. "At FromSoftware, we strive to create games that evoke emotion, deliver value, and bring joy to players," the company stated in a press release dated October 4, 2024. "To support this mission, we are committed to ensuring stable income and fostering a rewarding work environment where our employees can thrive in their development roles. This salary increase is a direct reflection of that commitment."

This move comes after FromSoftware faced criticism in 2022 for offering wages that were considered low compared to other Japanese game studios, despite its international 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 the high cost of living in Tokyo.

The adjustment aims to align FromSoftware's compensation more closely with industry standards, following a trend set by other companies such as Capcom, which is set 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, marked by an unprecedented number of layoffs. Major companies have shed thousands of jobs as part of their restructuring efforts. However, Japan has largely managed to avoid this trend.

In 2024, over 12,000 game industry employees worldwide were laid off, with giants 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 exceeded 2023's figure of 10,500 employees, and the year isn't over yet. While Western studios often cite economic uncertainty and corporate mergers as reasons for these reductions, Japanese game companies have adopted a different strategy.

Japan's stable employment landscape is supported by stringent labor laws and a strong corporate culture that values employee retention. Unlike the "at-will employment" system in the United States, which allows companies to dismiss employees for almost any reason, Japan's labor laws provide significant protections against unfair dismissals and mass layoffs.

In addition to FromSoftware, other major Japanese companies have also raised their starting salaries. Sega increased wages by 33% in February 2023, while Atlus and Koei Tecmo followed with hikes of 15% and 23%, respectively. Even amid lower profits in 2022, Nintendo committed to a 10% pay increase for its employees. These initiatives align with Japan’s Prime Minister Fumio Kishida’s efforts to encourage wage hikes nationwide 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 endure long working hours, often working 12-hour shifts six days a week. Contract workers, in particular, remain vulnerable, as their contracts may not be renewed without being classified as layoffs.

As 2024 continues to set a somber record for global video game industry layoffs, Japan's unique approach to employee welfare and job security stands out. Gamers and industry watchers alike are keenly observing whether Japan can maintain its protective stance against layoffs amidst increasing global economic pressures.