The coming recession will hit the industry hard | Opinion
Rob Fahey
Contributing Editor
Friday 24th June 2022
There's a very solid chance that we're looking down the barrel of a global recession in the coming months -- and by most forecasts it's set to be the kind that seriously impacts on people's livelihoods and consequently on consumer spending. A lethal brew of soaring inflation, asset price bubbles and geopolitical uncertainty is being set loose upon economies that still haven't full digested the impacts of the pandemic, and that's going to cause one hell of a hangover in the morning.
As Brendan Sinclair noted last week, the games business shouldn't be expecting any kind of immunity from the effects of such a recession. For many years, conventional wisdom within the industry stated that video games were a recession-proof sector; then 2008 rolled around and delivered a gut-punch to many major industry players, and now the conventional wisdom has shifted to a widespread acceptance that such halcyon days of casually posting quarterly growth figures all the way through even the toughest of economic downturns are long behind us.
Certainly, all the signs at the moment suggest that the industry isn't in for a soft landing in the coming months and years. Since most of the Western world tacitly agreed to pretend that the pandemic had ended, we've seen seven straight months of declining year-on-year revenues for games in the USA -- which feels portentous given the alarm bells ringing in other sections of the economy.
"Games which rely on a smaller group of people pumping a lot of money into them are going to have a very, very rough time in a recession"
How bad will things actually get, though? And is there really nothing left of the industry's once brash outlook on economic hardship? To
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