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 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 the video game industry grapples with significant job losses in 2024, FromSoftware, the celebrated developer behind titles like Dark Souls and Elden Ring, has implemented a substantial 11.8% increase in starting salaries for new graduate hires. Effective April 2025, these salaries will rise from ¥260,000 to ¥300,000 per month. In a press release dated October 4, 2024, the company stated this increase reflects its commitment to a stable and rewarding work environment conducive to game development.

In 2022, FromSoftware faced criticism for comparatively lower wages than 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 benchmarks, mirroring similar moves by companies like Capcom, which will increase starting salaries by 25% to ¥300,000 by the start of the 2025 fiscal year.

A Divergence: Western Layoffs vs. Japanese Stability

The global gaming industry experienced unprecedented layoffs in 2024, exceeding 12,000 job cuts. Major players like Microsoft, Sega of America, and Ubisoft implemented significant reductions despite record profits. This surpasses the 10,500 layoffs in 2023. While Western studios often cite economic uncertainty and mergers as justifications, the Japanese gaming sector presents a contrasting picture.

Japan's stable employment landscape is largely attributed to robust labor laws and established corporate culture. Unlike the "at-will employment" prevalent in the US, Japan offers stronger worker protections, making mass layoffs legally challenging.

Numerous major Japanese companies followed suit with salary increases. Sega implemented a 33% increase in February 2023, while Atlus and Koei Tecmo raised wages by 15% and 23%, respectively. Even with lower profits in 2022, Nintendo committed to a 10% pay hike. These actions may be a response to Prime Minister Fumio Kishida's nationwide push for wage increases to combat inflation and improve working conditions.

However, challenges remain within the Japanese industry. Long working hours, often exceeding 12 hours daily for six days a week, are common, particularly affecting vulnerable contract workers whose contracts might not be renewed without technically being classified as layoffs.

Despite the record-breaking global layoffs of 2024, Japan has largely avoided the worst of the cuts. The future will reveal whether this approach can sustain its workforce in the face of increasing global economic pressures.