FromSoft Raises Salaries Against Industry Trend of Layoffs

Amidst widespread industry layoffs, FromSoftware bucks the trend by raising starting salaries for new graduate hires. This article explores FromSoftware's decision and the contrasting situations in the global gaming industry in 2024.

FromSoftware's Counter-Move to Industry Layoffs

FromSoftware Increases Starting Salaries by 11.8%

While 2024 has seen significant job cuts across the video game industry, FromSoftware, the creator of acclaimed titles like Dark Souls and Elden Ring, has announced an 11.8% increase in starting salaries for new graduate hires. Beginning April 2025, new graduates will receive ¥300,000 per month, up from ¥260,000. In a press release dated October 4, 2024, the company stated this increase supports a stable work environment focused on employee well-being and development.

In 2022, FromSoftware faced criticism for relatively low wages compared to other Japanese studios, despite its international success. The reported average annual salary of approximately ¥3.41 million (around $24,500) was noted by some employees as insufficient to cover Tokyo's high cost of living. This salary adjustment aims to align FromSoftware's compensation with industry standards, following similar moves by companies like Capcom, which is increasing starting salaries by 25% to ¥300,000 by the start of the 2025 fiscal year.

Western Layoffs Contrast with Japan's Stability

The global video game industry experienced a turbulent 2024, with record-high layoffs exceeding 12,000 jobs. Major companies such as Microsoft, Sega of America, and Ubisoft implemented significant cuts despite record profits. This surpasses the 10,500 layoffs in 2023. While Western studios cited economic uncertainty and mergers as reasons, the Japanese gaming industry largely avoided this trend.

Japan's stable employment landscape is attributed to its robust labor laws and corporate culture. Unlike the "at-will employment" prevalent in the US, Japan's worker protections and limitations on unfair dismissal create significant barriers to mass layoffs.

Furthermore, many major Japanese companies, mirroring FromSoftware's actions, increased starting salaries. Sega implemented a 33% increase in February 2023, followed by Atlus (15%) and Koei Tecmo (23%). Even with lower profits in 2022, Nintendo committed to a 10% pay raise. These increases may be a response to Prime Minister Fumio Kishida's push for nationwide wage increases to combat inflation and improve working conditions.

However, challenges remain within the Japanese industry. Long working hours, often exceeding 12 hours daily for six days a week, are common, particularly affecting vulnerable contract workers whose contracts may not be renewed without being classified as layoffs.

While 2024 witnessed record-breaking global layoffs in the video game industry, Japan's approach has largely mitigated the impact. The future will reveal whether Japan's strategy can continue to protect its workforce amidst growing global economic pressures.