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 affecting 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: A Salary Increase

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 implemented a substantial 11.8% increase in starting monthly salaries for new graduate hires. Effective April 2025, this raises the starting salary from ¥260,000 to ¥300,000. In a press release dated October 4, 2024, the company emphasized its commitment to a stable and rewarding work environment conducive to game development. This salary increase is a key element of that commitment.

In 2022, FromSoftware faced criticism regarding relatively lower salaries compared to other Japanese studios, despite its international success. Previously reported average annual salaries of around ¥3.41 million (approximately $24,500) were noted by some employees as insufficient to cover Tokyo's high cost of living. This adjustment aims to align FromSoftware's compensation with industry benchmarks, mirroring similar moves by companies like Capcom, which is implementing a 25% starting salary increase (from ¥235,000 to ¥300,000) by the start of its 2025 fiscal year.

A Divergent Path: West vs. East in the Gaming Industry

The global gaming landscape in 2024 has been marked by unprecedented layoffs, with thousands of jobs lost across major companies in North America and Europe. These cuts, totaling over 12,000 jobs in 2024 alone (exceeding 2023's total of 10,500), have been implemented by companies like Microsoft, Sega of America, and Ubisoft despite record profits. While Western studios often cite economic uncertainty and mergers as justifications, the Japanese gaming industry presents a contrasting picture.

Japan's relatively stable employment environment is largely attributed to robust labor laws and established corporate culture. Unlike the "at-will employment" prevalent in the United States, Japan's worker protections and limitations on arbitrary dismissals create significant barriers to mass layoffs.

Furthermore, many major Japanese companies have also increased starting salaries, including Sega (33% increase in February 2023), Atlus (15%), Koei Tecmo (23%), and Nintendo (10%). These actions may be partly in response to Prime Minister Fumio Kishida's initiative to boost wages nationwide to combat inflation and improve working conditions.

However, the Japanese industry isn't without its challenges. Reports indicate long working hours, often exceeding 12 hours daily for six days a week, are common for many developers. Contract workers remain particularly vulnerable due to the potential for non-renewal without technically being classified as layoffs.

While 2024 has witnessed record-breaking layoffs in the global gaming industry, Japan has largely avoided the most severe impacts. The coming months will reveal whether Japan's approach can continue to protect its workforce amidst increasing global economic pressures.