FromSoft Raises Salaries Against Industry Trend of Layoffs

FromSoftware's recent salary increase 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-Trend Salary Hike

FromSoftware Boosts Starting Salaries by 11.8%

While 2024 has seen significant job cuts across the video game sector, FromSoftware, the developer behind acclaimed titles like Dark Souls and Elden Ring, has announced an 11.8% increase in starting salaries for new graduate hires. Beginning April 2025, new graduates will receive ¥300,000 per month, up from ¥260,000. The company stated in its October 4, 2024 press release that this increase reflects its commitment to a stable and rewarding work environment that fosters employee development.

This move follows criticism FromSoftware faced in 2022 regarding relatively lower wages compared to other Japanese studios, despite its international success. The previously reported average annual salary of ¥3.41 million (approximately $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 norms, mirroring similar increases at companies like Capcom, which is raising its starting salary to ¥300,000 by the start of its 2025 fiscal year.

Western Layoffs Contrast with Japan's Stability

The global gaming industry experienced a turbulent 2024, marked by unprecedented layoffs. Thousands of jobs were eliminated by major companies in North America and Europe, despite record profits in many cases. This contrasts sharply with the situation in Japan, which largely avoided these widespread cuts.

Over 12,000 gaming industry employees globally lost their jobs in 2024, exceeding the 10,500 figure from 2023. Companies like Microsoft, Sega of America, and Ubisoft implemented significant reductions, often citing economic uncertainty and mergers. Japan, however, has remained relatively unscathed.

This stability in Japan is attributed to stricter labor laws and established corporate culture. Unlike the "at-will employment" prevalent in the US, Japanese labor protections create legal hurdles for mass layoffs, including the concept of unfair dismissal.

Moreover, numerous major Japanese game companies, including Sega (33% increase in February 2023), Atlus (15%), Koei Tecmo (23%), and Nintendo (10%), implemented salary increases, often in response to Prime Minister Kishida's push for nationwide wage hikes to combat inflation and improve working conditions.

However, this isn't to say Japan is without its challenges. Long working hours, often exceeding 12 hours daily for six days a week, are common, particularly affecting contract workers whose contracts may not be renewed without technically being classified as layoffs.

Despite the grim global picture of 2024's gaming industry layoffs, Japan has largely avoided the worst of the cuts. The future will reveal whether Japan's approach can continue to protect its workforce amidst growing global economic pressures.