The past five years of writing about the games business has come with a helping of cognitive dissonance so severe that it often felt like whiplash. Record success one week; record layoffs the next. Studios launch critically and commercially acclaimed games, only to make large swathes of their creative teams redundant a few months later. Every even-numbered headline is about financial doom and gloom; every odd-numbered one is about soaring demand and record-breaking sales.
It’s hard to overstate just how much damage has been done to the underlying fabric of the industry’s creative side since the mass layoffs really started to kick in around 2022. It’s not just that tens of thousands of people have lost their jobs, upending their lives and their careers in the process. We’ve had downturns before; but the endless grind of it, the long years in which the bad news has never stopped coming, has taken a deeper toll, one for which a full accounting is yet to be made.
The games business has never been good at retaining talent, historically losing a significant proportion of its most experienced staff every year as they reach an age where family and other responsibilities can no longer be squared away with the high demands and constant instability of game development jobs. This becomes a vicious cycle – losing older, more experienced staff and leaving behind their younger colleagues allows the late-night-crunch-and-pizza-parties vibe to continue long past the stage where it’s become actively damaging to a company’s work culture and productivity.
The games business has never been good at retaining talent
Things have improved over the years, albeit slowly and unevenly, but the brutal layoffs have pushed the situation many steps back. A 25-year-old forced to move to a new city and struggling to find work after a layoff is in a tough situation but can often scrape by until something comes up. A 35-year-old with two kids in school facing the same situation doesn’t have that luxury – and no matter how passionate about games they may be, will be wary of putting themselves and their families in that kind of vulnerable position again.
The effects of that brain drain – the quiet departure of people with countless combined years of experience – will be felt long after the economic situation turns around and the mass layoffs taper off. They’ll be felt in missed deadlines, in miscommunication between teams, in poorly specified features, in project plans that fail to make proper allowance for vital, overlooked tasks; in an endless number of wheels expensively reinvented at studio after studio for years to come.
Yet even that assessment may underestimate the scale of the damage, because the headline layoff figures, as awful as they are, disguise a worse reality. Kotaku published an excellent piece this week on the impact of the layoffs on contractors, which highlights an overlooked aspect of what’s happened. Some of the reason why working culture has seemed to improve at studios and publishers in the past couple of decades is actually down to an explosion in the use of subcontracting staff and companies – much of which has been a useful shortcut to bringing on board valuable expertise, but at least some of which has effectively functioned as a way to outsource crunch conditions to people who don’t technically work for you.
Using subcontractors is a way to outsource crunch conditions to people who don’t technically work for you
Unsurprisingly, when directly employed studio staff are being let go, the subcontractors – a pool of labour who enjoy few if any of the protections of direct hires – bear an even worse brunt. I’ve been told that some of the biggest rounds of layoffs of the past few years saw a 2:1 or even 3:1 ratio of contractor positions slashed to in-house staff made redundant. Redundancy numbers pull in the headlines, but statements like Asha Sharma’s reference to culling 50% of Xbox “vendor spend” get lost in the noise, despite the likelihood that this represents thousands more jobs lost on top of those people being directly made redundant by Microsoft.
It’s impossible to make a full accounting, but entirely likely that including contractors in the numbers would at least double the actual layoff figures in the past half decade. Being laid off is terrible for anyone, of course, but for contract or outsourcing staff it can be especially disruptive. Outsource staff are often bound by contracts that prevent them from talking about projects they’ve worked on, for example, severely tying their hands in terms of job hunting in future. Granted, that’s also become a major issue for directly employed staff – it’s not uncommon for developers to have multi-year stretches on their resumes which say “third-person action adventure” or something equally vague, because the project they worked on was cancelled and even its name is under NDA.
In the face of all this disruption – not just of businesses or of projects but of lives, and with it a wholesale destruction of priceless reservoirs of experience and skill – it’s increasingly hard to accept the idea that what happens after the dust settles is simply going to be a reversion to the norm. Any norm that emerges from this half-decade of grinding chaos would itself be a twisted parody of “business as usual” in which everyone spends their days flinching in anticipation of the next round of management jitters that drive staffing levels back off the cliff.
It’s far from the first time that people have felt that we can’t go on like this – efforts to push for a more equitable, stable and effective business paradigm for game creation have been around for at least the past thirty years. Major change is often only enabled by the burning down of the previous system, though, and for many people it feels like that’s what the last few years have constituted.
The model as it currently exists isn’t just unsustainable for staff, but for studios too
The model as it currently exists isn’t just unsustainable for staff who live with intolerable instability from month to month, and for whom successful execution and commercial success is no guarantee of employment continuity. It’s also unsustainable for the studios themselves; the skyrocketing costs of development are a well-documented topic, and a major concrete effect is that the number of potential sources for funding large-scale game development has shrunk dramatically. This decade has seen major outflows of both cash and investor interest from the games business, leaving very few options for securing financial backing for a major games project; the numbers are so high and the risks are so perilous.
If the current paradigm is broken for both staff and studios, though, what might a new one look like? Nobody actually has a comprehensive answer yet, but it’s unsurprising that many eyes are turning to the indie market – not as a complete model for the future, but rather as a glimmer of hope that shows that giant budgets, tortured development processes, and sweeping rounds of layoffs aren’t the only option on the table.
The indie sector can’t offer all the answers, but it gives some clear pointers about what is possible; it suggests that there really are options to replace or at least supplement the current paradigm of a handful of giant, powerful companies holding the purse strings of project funding, and upturning thousands of lives on an economic whim or the ebb and flow of a boardroom strategy.
One option, for example, is that the strategies and approaches honed at an indie scale could be applied effectively to prototyping – building smart, lean proof-of-concept builds at a rapid scale, something which modern tools and techniques have made more accessible than ever. A model in which independently created prototypes play a central role would follow the lead of some aspects of the film and TV industries; small, lean teams rapidly iterating on prototypes using seed capital from specialised production firms (enough to pay salaries and keep the lights on, but little more), with the intention of bringing those prototypes to larger publishers who bid for the right to put them into full-scale execution.
Many publishers, bluntly, are incredibly bad at starting internal development from scratch
The payday comes when a publisher buys an option and funds full-scale development – with the appeal to publishers and platform holders being that they can shift the axis around which their creative choices pivot in a way that gives them far more confidence and wastes far less time pursuing failed projects. Instead of messy, unfocused internal development from scratch (which many publishers, bluntly, are incredibly bad at), the model becomes focused around choosing from a selection of well-considered, well-planned prototypes honed by skilled teams, and then spending development budgets on executing on a clear, fixed plan.
Moving to a model like this wouldn’t be smooth sailing – nor would such a model likely exist in isolation, but rather as part of an ecosystem of different approaches in a more diverse industry. Publishers would have to unlearn some of their worst habits; boardrooms will need a long ruler to smack the knuckles of anyone who starts to reach out to do direct creative meddling, for a start. The advantages to both sides, however, would come from confidence and stability. Separating the “prototype” work from the “production” work – with studios specialising in one or the other – would avoid the messy situation of having a “production-scale” studio that suddenly has hundreds more staff than it needs when one project ends and the prototyping phase for the next begins, which is a major cause of career instability at the moment.
There is a movement to reshape creative industries in order to provide the stability and structure that people need to build long-term careers
This is far from the only idea out there (and to be clear, I’m not claiming it as mine – it’s a variation on a theme that’s been discussed many times of late) and may not even resemble what does finally emerge as a model, or a set of models, for development and creativity in the future. What seems increasingly clear, though, is that there is a wellspring of determination that something must change; things cannot go back to the way they have been. This is a sense that goes beyond the borders of the games industry; in areas like movie and TV production, themselves going through their own agonies in the era of streaming and after the collapse of low-interest financing, there’s also a growing movement to find new ways to reshape their industries in order to provide the stability and structure that creatives need to build long-term careers and do their best work.
As powerful a force as mean reversion may be, major change is also possible – and in the long term is likely inevitable. When so much of the forest has burned down around us, not all of the green shoots that emerge will be the same trees as before; and when so many of the industry’s vital creative talents are determined not to return to the systems of the past that have caused so much destruction this decade, the inertia for change may become irresistible.
