2023 was commonly considered one of the great years in gaming–solely because of the high calibre of gaming experiences. However, the year also saw a torrential downpour of layoffs, affecting upwards of 9,000 workers in the industry.
The year may be fondly remembered for games like The Legend of Zelda: Breath of the Wild, Alan Wake 2, Marvel’s Spider-Man 2, and more, it’s important to reflect on how the year treated game creators. However, according to recent unofficial year-end data (via The Verge), 2023 was anything but kind to developers. It’s shown that layoffs throughout the year affected both large-scale developers and smaller studios.
One of the biggest culprits of industry layoffs in 2023 was Embracer Group. Throughout the last few years, the major publisher made waves in the news after acquiring a variety of studios, including Saber Interactive, Volition, Crystal Dynamics, etc. However, in June 2023, Embracer Group announced a large-scale restructuring program that was taken into effect to offset a $2 billion USD (around $2.6 deal with Savvy Games Group that fell through, according to Axios. Embracer Group then announced a series of layoffs, and studio closures, including Saints Row studio Volition. As the dust settled, around 904 employees (5 percent of its workforce) had been laid off with around 15 projects also cancelled.
Epic Games was also hit with a large-scale layoff in 2023. This past year, the Fortnite studio announced that around 830 staff members (16 percent of Epic employees) would be affected to “stabilize our finances,” CEO Tim Sweeney said. The major round of layoffs also affected Bandcamp, which after being acquired by Epic Games, is now divested into Songtradr. Epic Games is a multibillion-dollar company, generating revenue through Fortnite microtransactions as well as licensing via Unreal Engine. It’s hard to imagine how a company so successful and profitable had to resort to laying off so many staff and yet here we are.
Destiny 2 studio Bungie was another to make headlines for its layoffs. Affecting roughly 100 employees, the now Sony-owned studio took a rather big hit after Destiny 2‘s last year reportedly underperformed. Alongside a colder-than-expected reception for its Lightfall expansion, Bungie’s The Final Shape expansion is reported that have been delayed to June 2024. The upcoming Marathon reboot is also believed to be internally delayed until 2025. To make matters worse, when Bungie was acquired by Sony in 2022 for $4 billion USD (roughly $5.2 billion CAD) was to go towards staff retention. According to reports, around $1.2 billion USD (nearly $1.5 billion CAD) was issued to ensure no layoffs would take place post-acquisition.
2023 also saw layoffs affect companies such as Microsoft, EA, Naughty Dogs, Ubisoft, CD Projekt Red, Activision Blizzard, Telltale Games, Blackbird Interactive, Niantic, and many more. In a year in which video game revenue was projected at $365.6 billion globally, it’s hard to fathom how so many people could end up losing their jobs or have no security. Layoffs in any industry are expected.
2023 saw what can only be described as an unfair landslide of course correction within many major companies. Expansion through COVID-19 was inevitable given how lucrative the industry was and continues to be. However, when the financial reality of said expansions kicked in, it was those working in art, engineering, QA, audio, and community management that were affected. Rarely, if ever, do we read stories that executive-level employees take a hit. Unfortunately, as it stands, there isn’t a guaranteed solution to prevent these types of layoffs from taking place in 2024. While many studios like Sega and ZeniMax have voted in favour of unionizing, this hasn’t been adopted across the entire industry.
