Everyone overhired the last 3 years thinking the good times were forever. They’re probably overloaded with roles they don’t need anymore and have needs in other places so it really doesn’t make sense to keep folks.
I assume video-game sales went up during the stay-at-home pandemic years; with that now behind us, this isn’t surprising at all. In fact, I’m surprised this didn’t already happen a year ago.
It did indeed start a year ago. Main reason it's ramping up so rapidly in the last 6 months is that games were released (in what many would consider an amazing years for games in 2023) and layoffs tend to happen a bit after shipping (to get launch bugs). But with the current economy the layoffs are more severe.
Another less talked about point is GaaS. Many, many studios were trying to ramp up games with continuous revenue streams, and that needs a big investment and risk. It's not ubcommon to launch 10 GaaS expecting 7 to fail and 1 to easily pay for the other 9's developments. That's a great strategy with free money. Awful when you need to weather a storm. And now we're on that storm. Even studios with successful GaaS have to reel back, so most games in development are SoL.
So, not surprising but the volume this year is immense.
> Everyone overhired the last 3 years thinking the good times were forever.
It's very convenient that this isn't measurable and if you asked anyone in the industry at the time they most likely would have said "We don't have nearly enough" people.
I don't like the term "overhiring" in these discussions because it implies that these studios didn't estimate the costs of development and see layoffs as a mark of failure.
Neither are true. They took a gamble with low risk and the low risk became normal risk. Layoffs often come with a small stock rise, so they aren't even shamed by shareholders for trimming down. It's devastating for employee morale but that's rarely a factor in these decisions.
