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The game industry is broken β can we fix it?
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- DeepHorus
The global videogame industry is facing its worst disruption since the 1980s, according to Epic Games CEO Tim Sweeney. Edge 428's cover story, by Alex Spencer, gathers nine experts to diagnose a crisis of mass layoffs, closed studios, and runaway budgets. Despite analyst predictions of overall revenue growth, the behind-the-scenes picture is grim.
Amir Satvat, who runs the ASGC Games Industry Layoffs Tracker since 2022, projects more than 14,500 videogame workers will lose jobs in 2025. That would bring the five-year total from 2022 to 2026 to over 58,000. Hundreds of development studios have closed, and console prices have risen since launch.
Satvat's hiring data suggests 18,000 to 25,000 people find new games jobs annually. The industry has grown modestly, by a few thousand people, but that contrasts with growth of 150,000 in the previous five years. He doubts it can avoid contracting from its current size, though it might stabilise at a less drastic number.
Layoffs are heavily localised. Satvat estimates that for 12 to 18 months, over half of global layoffs were in California. The UK, northern and western Europe, and North America are most affected. Other regions, including eastern Europe, Japan, and lower-wage countries, have been largely insulated.
Japan offers a potential model. Satvat says it is "a completely different ballgame," with layoffs in hundreds, not thousands, generally focused on overseas contractors to protect core staff. Nintendo, Konami, and Capcom report staff retention above 97 percent.
Japanese teams tend to be smaller and leaner, Satvat explains, avoiding the live-service trend and mega-blockbusters with 500-person teams. Executive salaries also differ sharply: $2 million to $3 million rather than $30 million. These choices may help explain Japan's resilience.
The crisis raises urgent questions about sustainability. With budgets and schedules out of control, experts warn the western industry cannot simply return to its previous size. Whether it can carve out a brighter future depends on learning from leaner models and stabilising employment.
