Why are Japanese developers not undergoing mass layoffs?
On 14th June, Tango Gameworks employees had a pizza party. It was the studio's final day following the announcement of Microsoft's decision to close the studio behind games like Ghostwire Tokyo and the award-winning Hi-Fi Rush, a decision that surprised many across the industry.
The game had been released on platforms beyond Xbox for the first time mere weeks earlier as part of the company's new initiative to bring their titles to more platforms. As the company's only Japanese studio in a region of growth for Xbox and Game Pass after decades of struggling to break into the gaming market in the country, the decision also appeared counterintuitive.
Layoffs and studio closures have been an unfortunately-common occurrence across the industry since last year, with layoffs in 2024 already matching 2023's total of over 10,000 developers being put out of work. Yet if there is one bright spot to find in this bleak reality, it is, ironically, in the same city as the departed Tango. Its closure, undeniably tragic, is an exception in a country seemingly insulated from the industry-wide devastation occurring beyond its borders.
Indeed, if you focused solely on the Japanese industry, you would be forgiven for forgetting the crisis that has subsumed the wider industry.
FromSoftware president Hidetaka Miyazaki recently came out to vehemently support his team, with no layoffs planned. Konami have once again been growing their gaming business after making a retreat in the 2010s for the land of pachinko, while Capcom have recently raised wages far above the recent inflation stats of 2.5% by increasing base salaries for new employees by 28% starting in fiscal year 2025, one of numerous the company has enacted since 2022.
All this has occurred while increasing employment and development amidst record profits.
And let's not ignore Nintendo, which ever since Satoru Iwata's 3DS-era wage cut to avoid cutting staff has enjoyed impressive growth, hiring more employees and increasing base wages to
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