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 delves into FromSoftware's decision and the broader context of the industry's current challenges.

FromSoftware's Counter-Trend Salary Increase

FromSoftware Boosts Graduate Starting Salaries by 11.8%

While 2024 has witnessed significant job cuts across the video game sector, FromSoftware, the celebrated developer behind titles like Dark Souls and Elden Ring, has taken a different path. The studio 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 that this increase reflects its commitment to providing a stable and rewarding work environment to foster employee dedication and creative development.

In 2022, FromSoftware faced criticism regarding relatively lower compensation compared to other Japanese studios, despite its international success. Reported average annual salaries of approximately ¥3.41 million (roughly $24,500) were noted by some employees as insufficient to cover Tokyo's high cost of living. This salary adjustment aims to align FromSoftware's compensation with industry benchmarks, mirroring similar moves by companies such as Capcom, which is increasing starting salaries by 25% to ¥300,000 by the start of fiscal year 2025.

Western Layoffs Contrast with Japan's Relative Stability

The global video game industry experienced unprecedented layoffs in 2024, with major companies shedding thousands of jobs amidst restructuring. However, Japan has largely avoided this trend, unlike North America and Europe.

Over 12,000 game industry employees worldwide lost their jobs in 2024 alone, with companies like Microsoft, Sega of America, and Ubisoft implementing significant cuts despite record profits. The total surpasses 2023's 10,500, and the year isn't yet finished. While Western studios often cite economic uncertainty and mergers as reasons, the Japanese approach differs.

Japan's stable employment landscape is attributed to strong labor laws and corporate culture. Unlike the US "at-will employment" system, Japan's worker protections and limitations on unfair dismissal create barriers to mass layoffs.

Furthermore, many major Japanese companies, mirroring FromSoftware's actions, have increased starting salaries. Sega's 33% increase (February 2023), Atlus and Koei Tecmo's 15% and 23% increases respectively (also in February 2023), and Nintendo's 10% pay hike (despite lower 2022 profits) are examples. These actions may be a 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 12-hour days, six days a week) are common, and contract workers face vulnerability due to the possibility of non-renewal without being classified as layoffs.

Despite 2024's record-breaking global layoffs, Japan has largely escaped the worst of the cuts. The industry awaits to see if Japan's approach can continue to protect its workforce amidst increasing global economic pressures.