FromSoft Bucks Industry Trend, Raises Salaries

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 delves into 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 2024 has seen significant job losses across the video game sector, FromSoftware, the celebrated studio behind titles like Dark Souls and Elden Ring, has taken a different path. The company has implemented a substantial 11.8% increase in starting monthly salaries for new graduate hires.

Beginning April 2025, new graduates will receive ¥300,000 per month, up from the previous ¥260,000. In a press release dated October 4, 2024, FromSoftware stated its commitment to fostering a supportive and rewarding work environment conducive to creative development. This salary increase is a key element of that commitment.

In 2022, FromSoftware faced criticism regarding relatively lower compensation compared to other Japanese studios, despite its international success. The reported average annual salary of approximately ¥3.41 million (around $24,500) was noted by some employees as insufficient to cover the high cost of living in Tokyo.

This salary adjustment aligns FromSoftware's compensation more closely with industry benchmarks, following the lead of companies like Capcom, which is also increasing starting salaries to ¥300,000 (a 25% increase) by the start of its 2025 fiscal year.

Western Layoffs Contrast with Japan's Relative Stability

The global video game industry experienced unprecedented layoffs in 2024, with thousands of job cuts across major companies like Microsoft, Sega of America, and Ubisoft, despite record profits in many cases. The total surpasses 2023's figure of 10,500, and the year isn't even over yet. While economic uncertainty and mergers were cited as reasons in North America and Europe, the Japanese gaming industry presents a contrasting picture.

Japan's comparatively stable employment market is largely attributed to robust labor laws and established corporate culture. Unlike the "at-will employment" prevalent in the US, Japan offers stronger worker protections, making mass layoffs legally challenging.

Furthermore, several major Japanese game companies, mirroring FromSoftware's action, have increased starting salaries. Sega implemented a 33% increase in February 2023, while Atlus and Koei Tecmo saw increases of 15% and 23%, respectively. Even with lower profits in 2022, Nintendo committed to a 10% pay raise. These moves may be partly in response to Prime Minister Fumio Kishida's national push for wage increases to combat inflation and improve working conditions.

However, this doesn't imply a complete absence of challenges in the Japanese industry. Reports indicate long working hours, often exceeding 12 hours daily 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 has established a concerning precedent for global video game industry layoffs, Japan has largely avoided the worst of the cuts. The coming months will reveal whether Japan's approach can continue to safeguard its workforce amidst growing global economic pressures.