What layoffs in the video game industry mean for developers and the games we love

AILSA CHANG, HOST:

The video game industry continues to be hit with layoffs. I mean, just this year at least 6,000 layoffs have been announced. That follows more than 10,000 cuts in 2023. Now, the easy explanation for why all of this is happening is that demand increase during the pandemic, when we were locked in our homes and into our devices, companies scaled up accordingly. And now that the world has opened up again, these companies need to rightsize. But that's only part of the story, according to IGN investigative reporter Rebekah Valentine. She's here now to tell us more. Welcome.

REBEKAH VALENTINE: Hi. Thanks for having me.

CHANG: Thanks for being with us. So I understand that you talked with more than 40 video game developers for your story. What have they been telling you? Like, what does it feel like to be a worker in this industry right now?

VALENTINE: The mood is pretty rancid. I heard from multiple people who were laid off twice in the same year.

CHANG: Oh, my gosh.

VALENTINE: Yeah. And even just hearing that from one person was astonishing. But then I heard it from like two or three people and all at different studios. Like, they would lose a job, they would find another and think, OK, well, maybe I'm OK for a little while and then just lose a second one.

CHANG: Geez.

VALENTINE: I heard stories from people who had moved across the country for a job that was requiring them to work in the office, and then only to get laid off from that job after they had spent all this money and time and energy moving across the country and now, you know, didn't know what to do. I've heard from people who both they and their partners work in the games industry, and so they're both either getting laid off or at risk of layoffs. It's just - it's pretty upsetting.

CHANG: Well, what are sort of the larger forces at play that's contributing to all these job losses? We talked about, OK, the pandemic's basically over. People are out of their houses. They're not hunched over their video game consoles anymore or not as much. But what else is going on?

VALENTINE: I think the biggest one, and one of the things that came up in my piece again and again, is that video games are getting really expensive to make. You need to have the best graphics, the most content, the most things for players to do. And as a result, they take even longer to make. So games that, you know, previously may have only taken two or three years to make are now taking four or five, six, seven, maybe even longer. And therefore the cost is just skyrocketing to make these big games.

CHANG: Well, how much of what you're describing right now has been a long time pattern in the video game industry? And by that I mean, like, you know, the way studios have always done business is to staff up when they're building games and then letting go of workers after a big launch, like, you know, when there's nothing left for them to do. How much are you just seeing more of the same thing that's inherent to the industry?

VALENTINE: I think it's very easy to sort of fall back on that and say, oh, well, the video game industry has always been like this. You know, you staff up when you're getting ready to release a big game, and then the game comes out and you let people go because you only need a very small team to start the next project and then you'll staff up again.

CHANG: Right.

VALENTINE: It's these waves. But again, just the sheer amount of people that are being impacted by this has only grown in recent years. And when you combine that with the fact that a lot of companies, both during the pandemic and even before, have been making big and sometimes very risky investments into a lot of different things - acquisitions of other studios, blockchain technology and NFTs. We're now having a lot of conversations about AI investments as well. A lot of companies are just spending and spending and spending in these very big ways. When you combine all of that together, you end up with this climate where everything just feels very unstable and very unsafe for the people who are actually doing the work of making video games and not making the choices of where the money goes and how it's used.

CHANG: Yeah. Well, do you think that the culture then within the video game industry is just fundamentally incompatible with job security, stability, predictability?

VALENTINE: Yeah.

CHANG: (Laughter).

VALENTINE: Long term, it certainly seems that way. I - if you talk to analysts, what I'm hearing a lot is that they're expecting layoffs to start to slow down as we get deeper into 2024. And then in 2025, there's an expectation that business will start to pick up again. The industry itself will continue to chug on like, I guess, the well-oiled machine it is. But just as like a person working in the games industry, it is kind of a fundamentally unstable career. And I think this has been a wake-up call for a lot of people in realizing that this thing that they love to do and are very good at - making games - is maybe not a place that they're able to retire in. And I don't know that we have a solution for that yet.

CHANG: That is IGN's Rebekah Valentine. Thank you so much for speaking with us.

VALENTINE: Thank you for having me. Transcript provided by NPR, Copyright NPR.