Press Start to Adapt: Conquering Layoffs in Gaming Realm

The gaming world, once seemingly safe from layoffs, is not immune to tech industry turmoil. Major cuts in Microsoft’s Xbox Team in February 2023 impacted even veterans from 343 Industries and Bethesda. Amazon’s gaming sector was not spared either, with 100 of Amazon Games’ employees laid off in April 2023. Similarly, Twitch, an Amazon property, bid farewell to 400 employees in March. So what’s the reality for layoffs in gaming? Are they here to stay?

Navigating the Gaming Landscape

The majority of gaming layoffs are tied to the wider tech industry unrest, impacting not just tech giants, but also independent game studios initiating their own layoffs – like Relic, Ten Square Games, and Embracer.

But it’s not all doom and gloom. These changes open doors for game dev studios agile enough to surf the waves of change. Guided by our Recruitment Lead, Patryk Suchy, we at 8Bit are determined to weather the storm and discover opportunities in gaming’s evolving landscape.

We aim not only to discuss industry trends but also to empower you with the right strategies to rise above layoffs. Because the best way to predict the future is to create it – and we’re here to assist you in doing so.

Layoffs in Gaming and Tech: Intersecting Paths

Tech layoffs certainly impact the gaming industry, but it’s not a one-to-one correlation. As Patryk Suchy explains, “Creating games is like blending tech with entertainment. Its artistic nature makes it challenging to predict a game’s financial outcome. A game can be a hit or miss – there’s seldom middle ground.”

Reflect on the hype around ‘Cyberpunk 2077’ by CD Projekt Red. Its success was undeniable. And there’s a strong vibe that ‘Diablo IV’ from Blizzard could follow suit. These games have created quite the stir, pointing to possible blockbuster performances. Yet, we should remember that this isn’t the usual fate for all games.

While tech layoffs have a role, they aren’t the sole movers and shakers in the gaming world. The plot thickens with a mix of artistry, tech, and how players react.

A Look Back: Gaming Layoffs Aren’t Unheard Of

Delving into the past, it becomes clear that layoffs aren’t unusual in the gaming industry. Well before the current wave of tech layoffs or the COVID-19 pandemic’s overstaffing repercussions, even the most renowned gaming studios have had to grapple with downsizing:

🟠 Telltale Games’ unfortunate closure in 2018 

🟠 Activision Blizzard’s 800 job cuts in 2019 

🟠 ArenaNet’s significant layoffs the same year

Each of these events paints a unique yet similar picture of the industry’s challenges, demonstrating that layoffs are not a recent phenomenon, nor exclusively tied to the tech industry’s fortunes. In the gaming world, layoffs can happen due to various reasons.

Three most common triggers for layoffs in the gaming industry, not tied to tech giants, are:

⚙️ Organizational restructuring: A change in strategy, a merger or acquisition, or a leadership change can result in layoffs.

📉 Performance failures: If anticipated games don’t perform well, the financial setback can force companies to downsize.

💸 Funding difficulties: Sometimes, especially for studios without a larger corporation’s backing, securing continuous funding can be a struggle, leading to layoffs as a survival measure.

Understanding these drivers helps to anticipate industry changes and devise strategies to navigate the gaming sector’s highs and lows.

Prevention and Preparation: The Key to Navigating Layoffs in Gaming

The gaming industry can be unpredictable, but the right actions can ensure resilience. Here’s how you can lessen the risk of layoffs:

🟢 Open Conversations: Share company updates with your team regularly. This honesty builds trust.

🟢 Trim the Extras: Reevaluate your expenses. Some perks might not be as essential as they seem.

🟢 Lead by Example: Leadership taking a temporary pay cut could protect other jobs, showing the team you’re all in this together.

🟢 Get Outside Help: Outsourcing certain functions or projects can save costs.

🟢 Skill Up: Cross-train your team. More skills can mean fewer layoffs.

🟢 Manage Well: Improving project management can reduce waste and save money, making layoffs less likely.

🟢 Stay Prepared: Promote a culture of forward thinking. Knowing how to react in a downturn can make it less disruptive.

Employing these tactics can strengthen your studio against turbulence and keep teams intact.

Capitalizing on Tech Layoffs in Gaming: A Hidden Talent Goldmine?

While it’s a given that laid-off talent from one gaming studio might transition to another, a question worth exploring is – what about employees from the broader tech industry?

This challenging period could turn into an opportunity for game development studios, opening up a pool of potential hires from tech companies, including those recently laid off from their gaming divisions.

Many of these professionals might be open to negotiating salaries or considering contract roles, offering an economical recruitment solution.

However, this venture isn’t without its challenges. Although these individuals may have transferable tech skills, they might lack specific game development knowledge – a gap that can be filled with effective onboarding and knowledge sharing within the team. This is where specialized gaming recruitment agencies can step in, efficiently identifying, vetting and placing these talents into the gaming world.

Attracting Top Talents Amidst Layoffs in Gaming: Potential Strategies

The current wave of layoffs in gaming and tech necessitates a strategic approach to talent attraction. Whether you’re a AAA studio or an indie developer, the key is to understand your unique strengths and use them to your advantage.

AAA Powerhouses: Strength in Resources

As a AAA studio, your significant resources and industry standing give you a hefty advantage. You’re in a prime position to attract top talent from both tech and gaming layoffs, bringing in a diverse skill set and a profound understanding of the gaming world. Such talent can fuel innovative game development and widen your audience reach. Additionally, your scale of operations allows for a seamless integration of the remote work trend, giving you access to a global talent pool without hindering operational efficiency.

Indie Studios: Agility is Power

For indie studios, your strengths lie in your nimbleness and adaptability. The capacity to make swift decisions, adjust quickly, and innovate without large-scale bureaucracy at your heels gives you a unique edge. But it goes beyond just quick reflexes.

The current layoffs in tech and gaming have started altering the talent market dynamics. What used to be a playground dominated by the big leagues is now more accessible to indie studios. High-level talent, once exclusively attracted to larger studios, is now more receptive to opportunities within smaller, innovative teams. The challenges indie studios faced in drawing industry leaders are diminishing, as tech gurus and gaming professionals look for fresh starts post-layoffs.

The Long-Term Outlook: A Changing Game Industry

Looking ahead, 8Bit’s lead recruiter, Patryk Suchy, notes: “The gaming industry’s fluctuations have always been intertwined with macroeconomic trends. A keen eye on these broader movements is crucial in crafting your studio’s strategy, yet at the same time, do not forget the finer details. Paying attention to the morale and well-being of your own team is equally important and often overlooked. Your team’s dynamism, creativity, and unity are what truly breathes life into your games and gives your studio its unique character”.

The current layoffs situation, both in tech and gaming, presents an opportunity to build a resilient employee culture and business strategy, setting up the gaming industry for success in the long term. So, buckle up, power through, and strategize like the champions you are. We’re in it to win it.