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 sweeping the gaming industry in 2024. This article explores FromSoftware's decision and the broader context of the industry's current challenges.

FromSoftware Counters Layoff Trend with Salary Increase for New Hires

FromSoftware Raises Starting Salaries by 11.8%

While 2024 has seen significant job losses across the video game industry, FromSoftware, the celebrated developer behind titles like Dark Souls and Elden Ring, has taken a different path. Effective April 2025, the company will increase the starting monthly salary for new graduate hires from ¥260,000 to ¥300,000—an 11.8% boost. In a press release dated October 4, 2024, FromSoftware stated their commitment to fostering a rewarding work environment that supports employee development and stable income. This salary increase is a key step in achieving that goal.

In 2022, FromSoftware faced criticism for relatively low 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 salary adjustment aims to align FromSoftware's compensation with industry standards, mirroring similar moves by companies like Capcom, which will raise starting salaries by 25% to ¥300,000 by the beginning of the 2025 fiscal year.

Western Layoffs Contrast with Japan's Relative Stability

2024 has been a turbulent year for the global gaming industry, with unprecedented levels of layoffs. Thousands of jobs have been cut by major companies undergoing restructuring, particularly in North America and Europe. Over 12,000 game industry employees worldwide lost their jobs in 2024 alone, exceeding the 10,500 figure from 2023. Companies like Microsoft, Sega of America, and Ubisoft implemented significant cuts despite record profits. These actions, often attributed to economic uncertainty and mergers, contrast sharply with the situation in Japan.

Japan's comparatively stable employment landscape is largely attributed to its strong 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, mirroring FromSoftware's actions, several major Japanese game companies have implemented salary increases. Sega increased wages by 33% in February 2023, while Atlus and Koei Tecmo followed with 15% and 23% increases, respectively. Even with lower profits in 2022, Nintendo committed to a 10% pay hike. These moves may be a response to Prime Minister Fumio Kishida's push for nationwide wage increases to combat inflation and improve working conditions.

However, this doesn't mean the Japanese industry is without its challenges. Reports indicate that many Japanese developers work extremely long hours, often 12-hour days, six days a week. Contract workers, in particular, remain vulnerable due to the potential for non-renewal of contracts without technically being classified as layoffs.

In conclusion, while 2024 has seen record-breaking layoffs in the global video game industry, Japan has largely avoided the worst of the cuts. The coming months will reveal whether Japan's approach can continue to protect its workforce amidst growing global economic pressures.