FromSoft Raises Salaries Against Industry Trend of Layoffs

FromSoftware's recent announcement of increased starting salaries for new graduate hires stands in stark contrast to the widespread layoffs impacting the gaming industry in 2024. This article explores FromSoftware's decision and the broader context of the industry's current challenges.

FromSoftware's Counter-Move to Industry Layoffs

FromSoftware Boosts Starting Salaries by 11.8%

While the video game industry grapples with significant job losses in 2024, FromSoftware, renowned for titles like Dark Souls and Elden Ring, has taken a different path. The studio has implemented a substantial 11.8% increase in starting salaries for new graduate hires.

Beginning April 2025, new graduate employees will receive a monthly salary of ¥300,000, up from ¥260,000. In a press release dated October 4, 2024, FromSoftware stated its commitment to a stable and rewarding work environment that fosters employee dedication to game development. This salary increase is a key element of that commitment.

In 2022, FromSoftware faced criticism for comparatively lower wages than other Japanese studios, despite its international success. Previously reported average annual salaries of approximately ¥3.41 million (around $24,500) were noted by some employees as insufficient to cover Tokyo's high cost of living.

This salary adjustment aligns FromSoftware's compensation with industry benchmarks, mirroring similar moves by companies like Capcom, which is raising starting salaries by 25% to ¥300,000 by the start of the 2025 fiscal year.

Western Layoffs Contrast with Japanese Stability

The global video game industry experienced unprecedented layoffs in 2024, with thousands of job cuts across major companies. These restructuring efforts impacted North America and Europe significantly, yet Japan largely avoided this trend.

Over 12,000 gaming industry employees worldwide lost their jobs in 2024, with companies such as Microsoft, Sega of America, and Ubisoft implementing substantial cuts despite record profits. This surpasses 2023's total of 10,500 layoffs. While Western studios cited economic uncertainty and mergers as reasons, Japanese companies adopted a different strategy.

Japan's stable employment market is largely attributed to its robust labor laws and corporate culture. Unlike the "at-will employment" prevalent in the United States, Japan offers stronger worker protections, making mass layoffs legally challenging due to unfair dismissal laws.

Several major Japanese companies, including Sega (33% wage increase in February 2023), Atlus (15%), and Koei Tecmo (23%), also raised salaries. Nintendo implemented a 10% pay hike in 2022 despite lower profits. These increases may be partly in response to Prime Minister Fumio Kishida's push for nationwide wage increases to combat inflation and improve working conditions.

However, challenges remain within the Japanese industry. Long working hours, often exceeding 12 hours a day for six days a week, are common, particularly for contract workers whose contracts may not be renewed without technically being classified as layoffs.

While 2024 saw record-breaking global video game layoffs, Japan largely avoided the worst of the cuts. The industry will observe whether Japan's approach can continue to protect its workforce amidst increasing global economic pressures.