Game Developers Gather in SF as Industry Reels From Mass Layoffs

In a good year for the game industry, the annual Game Developers Conference in San Francisco feels like “going to Disneyland,” said Russ Fan, a San Mateo game designer.

This is not one of those years. The conference, which gets underway Monday and is expected to draw tens of thousands of attendees, is taking place amid mass layoffs. And Fan is among the thousands of workers who have lost their jobs.

His prediction for this year’s conference? “Probably more serious and dour,” he said.

Roughly 8,000 workers have been laid off from the game industry since the start of 2024, according to a layoff tracker created by technical artist Farhan Noor. If the cuts continue, this year could surpass 2023, when about 10,500 people lost their jobs, according to the tracker.

Experts say no single cause drives the layoffs, and the numbers reflect the industry’s cyclical nature.

Fan was laid off from his game design job at Illumix, an augmented reality company, last March. This is not the first time he has been laid off in the two decades he has worked in the game industry. He recounted how, in one instance, he was laid off and then quickly brought back because the company had cut too many people and needed to finish a project.

“You become numb [to the layoffs],” he said. “Because if you don’t, they crush you.”

Though this year is shaping up to be difficult, experts project the industry will eventually rebound. But in the meantime, workers say the layoffs have cost them their livelihoods, produced a brutally competitive job market and could hurt the quality of the games themselves.

“It’s a staggeringly large number to comprehend,” said Alissa McAloon, the publisher and editorial director of Game Developer, a publication that covers the industry.

The layoffs especially impact California, where some 44,000 jobs are located, constituting about 40% of the game industry.

This is reflected in layoff notices, collected daily by Big Local News’ Layoff-Watch. According to the notices, Sega of America laid off 61 workers in early March, and Activision Blizzard and Riot Games will lay off 899 and 336 people, respectively, later this month.

The causes of the layoffs vary by company. The cuts at Activision Blizzard, for example, came after Microsoft acquired the company in October and then proceeded to slash 1,900 jobs across its gaming workforce.

Still, Dmitri Williams, a professor at USC Annenberg who studies the video game industry, said there are three factors that help explain the layoffs: A generation of video game consoles is nearing its end, driving down new machine sales. Some companies have struggled to keep up with the move toward “live service games,” where publishers continue to add new content after a game’s release. Meanwhile, the industry overall is shedding some of the jobs it added in response to a surge in demand during the pandemic.

“The industry isn’t collapsing,” Williams said. “This is more like the pendulum swing you would expect as the industry goes through its cycles, and it will probably swing up again in the coming years.

“But all this is cold comfort if you’re one of the people laid off,” he added.

Neha Nair, a former senior community and social media manager at Crystal Dynamics, was laid off in September. She has needed to cut costs to afford to live in San Jose with her partner, and the job search has been disheartening.

“Every role I’m applying for has at least a thousand applicants,” she said. “I want us all to land on our feet, and I hate that I’m competing against people that I’m rooting for.”

Nair is attending the Game Developers Conference and said she looks forward to connecting and finding support with others who have been laid off.

The conference will feature skill-building sessions and networking opportunities, which Conference Manager Ashley Corrigan said could be especially helpful for those affected by layoffs. The schedule includes sessions on working as a freelancer for the first time and weathering layoffs as a nonbinary individual, woman or transman.

Corrigan said people have gotten jobs and met future collaborators at previous conferences.

“This is the time, more than ever, that people should really lean into community,” she said.

Fan, the game designer, will be hosting a roundtable on layoff preparedness. He, too, encouraged people experiencing a layoff to stay connected with their personal and professional support networks.

“Leverage them as much as possible while you need to, and support them as much as you can while you’re able,” he said.

He predicted that the layoffs would have consequences that extend beyond the industry. He said it is easy to underestimate the power of games to create “moments of play and happiness,” and the loss of talent from the industry will hurt the games that come out down the road.

“When the resurgence [of the industry] happens, it will be great,” he said. “But there will be a drought of play, inspiration and innovation for at least a couple of years.”

This article was reported in partnership with Big Local News at Stanford University.