FromSoft Raises Salaries Against Industry Trend of Layoffs

FromSoftware's recent announcement of increased starting salaries for new graduates stands in stark contrast to the widespread layoffs affecting the gaming industry in 2024. This article explores 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 witnessed significant job cuts across the video game sector, FromSoftware, the creator of acclaimed titles like Dark Souls and Elden Ring, has taken a different path. The studio has implemented a substantial 11.8% increase in starting salaries for new graduate hires, raising the monthly pay from ¥260,000 to ¥300,000, effective April 2025. In a press release dated October 4, 2024, the company stated its commitment to fostering a rewarding work environment that supports employee growth and contributes to the creation of emotionally resonant and valuable games. This salary increase reflects a key element of that commitment.

In 2022, FromSoftware faced criticism regarding relatively lower salaries compared to other Japanese studios, despite its international success. The previously reported average annual salary of approximately ¥3.41 million (around $24,500) was 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 increasing its starting salary by 25% to ¥300,000 by the start of the 2025 fiscal year.

A Divergence: Western Layoffs vs. Japanese Stability

The global video game industry experienced a turbulent 2024, marked by unprecedented layoffs. Thousands of jobs were eliminated by major companies undergoing restructuring, primarily in North America and Europe. This contrasts sharply with the relative stability observed in Japan.

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 figure of 10,500, and the year isn't yet concluded. While Western studios frequently cite economic uncertainty and mergers as reasons for these reductions, the Japanese gaming landscape presents a different picture.

Japan's stable employment environment is largely attributed to its robust labor laws and established corporate culture. Unlike the "at-will employment" prevalent in the United States, Japan offers stronger worker protections, creating legal hurdles for mass layoffs due to principles like unfair dismissal.

Furthermore, several major Japanese companies, mirroring FromSoftware's actions, increased starting salaries. Sega's 33% wage increase in February 2023, along with similar increases by Atlus (15%) and Koei Tecmo (23%), and Nintendo's 10% pay hike in 2022 (despite lower profits), likely reflect Prime Minister Fumio Kishida's national push for wage increases to counter inflation and improve working conditions.

However, this doesn't negate Japan's industry challenges. Reports indicate that many Japanese developers endure demanding work schedules, often involving 12-hour days, six days a week. Contract workers remain particularly vulnerable, as contract non-renewal can circumvent official layoff statistics.

In conclusion, while 2024 witnessed record-breaking global layoffs in the video game industry, Japan largely avoided the worst of the cuts. The future will reveal whether Japan's approach can sustain its workforce's protection against escalating global economic pressures.