FromSoft Bucks Industry Trend with Salary Hikes Amidst Layoffs

FromSoftware's counter-intuitive move: salary hikes amidst widespread industry layoffs. This article explores FromSoftware's recent announcement and the broader context of the 2024 gaming industry's job cuts.

FromSoftware Defies Layoff Trend with Significant Salary Boost for New Hires

FromSoftware Raises Starting Salaries by 11.8%

In stark contrast to the prevalent 2024 trend of video game industry layoffs, FromSoftware, the celebrated studio behind Dark Souls and Elden Ring, has implemented a substantial increase in starting salaries for new graduate hires.

Beginning April 2025, new graduate employees will receive a monthly salary of ¥300,000, an impressive 11.8% jump from the previous ¥260,000. In a press release issued October 4, 2024, FromSoftware stated their commitment to "creating value and inspiring joy" through their games, and that this salary increase reflects their dedication to a supportive and rewarding work environment.

In 2022, FromSoftware faced criticism regarding relatively low wages compared to other Japanese game developers, despite its global success. Reported average annual salaries of approximately ¥3.41 million (roughly $24,500) fell short of meeting Tokyo's high cost of living, according to some employees.

This salary adjustment aligns FromSoftware more closely with industry standards, mirroring similar moves by companies like Capcom, which will increase starting salaries by 25% (from ¥235,000 to ¥300,000) by the start of their 2025 fiscal year.

Western Game Industry Hit Hard by Layoffs; Japan Shows Resilience

The global video game industry experienced unprecedented layoffs in 2024. Thousands of jobs were cut by major companies undergoing restructuring, predominantly in North America and Europe. This contrasts sharply with the relatively stable employment situation in Japan.

Over 12,000 game industry professionals worldwide lost their jobs in 2024 alone, with significant cuts at companies like Microsoft, Sega of America, and Ubisoft, despite record profits. The total surpasses 2023's figure of 10,500, and the year isn't over yet. While Western studios often cite economic uncertainty and mergers as reasons for these cuts, Japanese companies have adopted a different strategy.

Japan's robust employment landscape is largely attributed to strong labor laws and established corporate culture. Unlike the "at-will employment" prevalent in the US, Japan offers greater worker protections, creating legal hurdles for mass layoffs.

Furthermore, mirroring FromSoftware's actions, many prominent Japanese companies increased starting salaries. Sega raised wages by 33% in February 2023, while Atlus and Koei Tecmo implemented increases of 15% and 23%, respectively. Even with reduced profits in 2022, Nintendo granted a 10% pay raise. These increases may be a response to Prime Minister Fumio Kishida's national push for wage hikes to combat inflation and improve working conditions.

However, this doesn't mean the Japanese industry is without challenges. Reports indicate that many Japanese developers endure demanding work schedules, often working 12-hour days, six days a week. Contract workers, in particular, face vulnerability due to the potential non-renewal of contracts without technically being classified as layoffs.

Despite 2024's record-breaking global layoffs in the video game industry, Japan largely avoided the worst of the cuts. The future will reveal whether Japan's approach can continue to protect its workforce amidst growing global economic pressures.