2023 has been one of the best years in recent memory if you’re a fan of video games. The release schedule has been huge since January, from the Resident Evil 4 remake to a new Legend of Zelda to Starfield, Baldur’s Gate III, Spider-Man 2, and Alan Wake 2.
The flip side, however, is that it’s been an absolutely brutal year for the people who make video games.
Bellevue, Wash.-based game developer Bungie this week laid off approximately 8% of its overall staff, which reportedly followed a significant drop in players and revenue for its online shooter Destiny 2.
At first glance, this could be attributed to pure consumer backlash. Destiny 2’s latest expansion Lightfall launched Feb. 28, and immediately caught flak from both players and journalists for its unusually aggressive microtransactions. A significant number of Destiny 2 players seem to have reacted by finding something else to play, which is not difficult in 2023.
Bungie also handled the layoffs about as poorly as possible. Allegedly, many employees only found out they’d been dismissed when their security credentials or email access failed to work, and many of Bungie’s team managers didn’t know the layoffs were coming.
For a company that was aggressively hiring as recently as August, Bungie’s sudden reversal has become appropriately controversial. What’s worse is that they aren’t particularly unusual, either for this year or for the video game industry in general.
Over the course of 2023 to date, dozens of game developers and related companies from all over the world have laid off an estimated total of 6,400 employees, per VideoGameLayoffs.com. This has included major players such as Electronic Arts, Epic Games, Amazon, Unity, and Microsoft.
The easy explanation is to blame a worldwide market correction. Back in 2020, the audience for video games grew significantly, as it was one of the only entertainment fields that wasn’t obviously impacted by the COVID lockdowns. No movie theaters, sporting events, or theme parks were open, so consumers figured it was a good time to get really into Animal Crossing for a while.
However, the games industry’s resilience in 2020 turned out to be a statistical mirage. The video game release schedule is arranged so far in advance that the disruptive effects of the lockdown didn’t really start to affect the industry until early 2021, at which point they ran rampant over multiple companies. Even so, a lot of investment money flowed into the video game market in 2021 and 2022, with new players like the European-based Embracer Group spending lavishly to try to secure a beachhead in the video game business.
In 2023, reality has caught up to a lot of those investors. Video games are difficult to make, impossible to make quickly, and often have production budgets that rival or exceed a Hollywood blockbuster. This is not the business to get into if you’re looking for a quick return on your money, as Google inexplicably did not know.
Worse, the games market has been absolutely flooded this year. Game investment is never a sure thing, but the market’s been unusually volatile. There’s barely been time to breathe between blockbusters, so games that would or could have been at least modest successes in any other year have gotten lost in the crush in 2023.
That’s compounded by the games industry’s preexisting labor issues, which have been a serious problem for decades. These have ranged from genuinely abusive workplaces to massive hire-and-fire cycles to compulsory overtime, a.k.a. “crunch culture.” Many of the most famous video games in the world, such as Cyberpunk 2077, were created under circumstances that have also produced substantial human damage.
The combination of an uncertain, insecure labor environment and a tidal wave of disappointed new investors has created a perfect storm for game makers in 2023. It’s the best year in decades for players, but the worst year in recent memory for developers.
In the short term, several companies, such as ProbablyMonsters, have tried to take a top-down approach to the issue by creating workplace cultures with a focus on avoiding employee burnout. The theory is that it should be possible to make video games without also destroying the people to make them.
Another, more likely option is that this will get resolved through grassroots organization. The Bungie layoffs have already led to renewed calls for the long-overdue creation of a game developers’ union, particularly in the wake of this year’s WGA and SAG-AFTRA strikes. Organizations like Game Workers Unite had already started up back in 2018, but pandemic disruption seems to have slowed their momentum until now.
Realistically, the games industry has many of the same problems as any other entertainment industry in 2023. The bigger companies run the overall market, because they control many of the most popular brands, but most of them are also run by out-of-touch executives. It’s created a workplace environment that’s nearly guaranteed to burn out or drive off most of the people who are actually creating games.
It’s a story that’s slowly coming to define this decade, and in the games industry, it ends with either a market collapse — you can actually draw a lot of useful parallels here to the end of the 1960s Hollywood studio system — or labor organization. Pick your favorite, place your bets, and keep an eye on the news in 2024.
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