The Cycle of Mass Layoffs in the Video Game Industry is Not a Problem of "Culture" – It’s a Problem of Exploitation
Video game workers tell me what it's like to live in precarity.
This article was originally published by Jacobin on May 16th, 2024 in a different form here.
The video game industry is putrefying. From so-called “triple-A” games bloated with vacuous, buggy content, to the extreme virulence of Skinner-Box gambling mechanics that nickel and dime players out of their savings in games that already cost $70 retail, to overpaid and oversexed CEOs who would make King Solomon blush telling their workers “we see you, we hear you” before kicking them out on the street, to the hundreds of thousands of overworked, under-unionized, sexually harassed, and burned out game developers losing their livelihoods in mass layoffs as a matter of seasonal routine — things are pretty bleak in the digital entertainment world these days.
“I think the state for workers in the industry is the worst it's ever been,” one longtime game developer told me under condition of anonymity. “The mood is one of defeat and hopelessness,” they said. Having worked fairly consistently in video games since the 1990s at both big-name companies and smaller outfits, this industry veteran, referred to here as “Kai,” has a long view of how the industry has changed over the years. They, along with all of their colleagues, were recently laid off from an unceremoniously shuttered game studio. Having just lost their job and been pushed into a highly competitive market, they feared that what they said to me may prevent them from regaining their livelihood in the industry, hence the anonymity. “Even when you believe you've found yourself the right job, it can evaporate in an instant, and then you are suddenly competing against hundreds or thousands of people for every job position,” Kai said.
Their team is far from alone. For over a year now, video game workers have been crushed by one mass layoff after the other. Approximately 20,000 people have lost their jobs since 2023, contributing to what many workers in the industry are describing as a nadir. One worker who spoke to IGN’s Rebekah Valentine said, “I've been in the industry for 15 years and I've never seen things this bad. Everyone is scared and waiting to see if their studio is going to be next. I am worried that this year is going to cause real, permanent damage and scarring to the game devs affected, and it's not going to be good. The aftershocks of this are going to resonate for the foreseeable future.”
Unfortunately, the very nature of video games as a form of escapist entertainment often leads to their dismissal as trivial or inconsequential by many people. This overlooks the immense cultural and economic impact of the gaming industry, which surpasses the music and film industries combined by over a hundred billion dollars. A single game, Grand Theft Auto V, released over a decade ago, continues to rake in millions of dollars in yearly revenue and has netted its developer, Rockstar Games, over $8.9 billion.
“There's people at the top making a lot of money, and then there's the people at the bottom making the thing that makes that money,” Wayne Dayberry, a game tester at Zenimax, a large video game company based in Maryland, and member of the recently formed Zenimax Workers United, told me. “You'd think that with the amount of money that comes in on that industry that it would benefit somebody to be a part of it. And it does if you're on a certain level. But everybody's not getting paid what they should be getting paid.”
With the sword of Damocles always hanging over video game workers’ heads, those in the media who write and speak about working conditions in the industry have a specific responsibility to be clear about why game developers are facing worsening conditions and what can be done to fix it. Sadly, though predictably, the mainstream press often fails in this mission by instead lending legitimacy to corporate-friendly notions that the video game industry is inherently unstable, has a “culture” of precarity, and that workers simply need to “get good” or get out. By uplifting the tired talking points of the executive class, mainstream journalists are obfuscating the defining characteristic of today’s video game industry: unmitigated exploitation of labor.
Mass Layoffs – A Tool to Control Workers and Boost Share Prices
In yet another round of mass layoffs this year, Microsoft has recently shuttered multiple game development studios in what one developer described as “a fucking gut stab.” From industry giants such as Activision-Blizzard and Ubisoft, to smaller indie developers such as Possibility Space, no studio seems immune to the ruthless mandate of corporate cost-cutting. The casualties of this profit maximization are the countless game developers who pour their labor into bringing virtual worlds to life, only to find themselves discarded once the product is shipped, regardless of how well the game actually sells. “People are struggling to not lose houses they were lucky enough to buy, spending six months at a time trying to scrape by on savings or unemployment while trying to find a new job,” Kai said.
Though to an untrained eye mass layoffs may indicate a crisis in profitability, video game companies are actually doing quite well. Microsoft imposed those aforementioned layoffs shortly after posting profits of $21.9 billion in the latest quarter, an increase of 20 percent over the previous year. The industry as a whole holds the dubious distinction of having several of the “most overpaid” CEOs, with Bobby Kotick, CEO of Activision Blizzard (and known sexual-abuse enabler) having an estimated net-worth of $7 billion. Kotick made $154 million in 2020 alone. At the same time, some of his employees were going hungry. “One employee wrote that they had to skip meals to pay rent and that they used the company’s free coffee as an appetite suppressant,” writes Time Magazine. “Another said they would only eat oatmeal and bail on team lunches because they couldn’t afford to buy food at the company cafeteria. A third said they and their partner stopped talking about having kids because they knew they wouldn’t be able to afford it. That contrasted with pictures they saw of more senior Blizzard employees enjoying vacations to Disneyland with their families.”
Despite the industry being immensely profitable, video game executives have lost any compunction they may have once had when it comes to imposing astounding amounts of layoffs on their precarious workforces, wielding tens of thousands of firings as a blunt instrument to appease shareholders and boost short-term profits. The mere announcement of mass layoffs can cause a significant jump in a company’s share prices, thus creating a perverse incentive to fire as many people as possible.
Tech companies often lay people off not because they are losing money, but because they are simply growing at a slower rate than before. In 2019, Activision Blizzard fired 800 people “despite posting ‘record-setting’ revenue.” Microsoft fired 10,000 people in 2023 even though the company was still profitable and growing, just not as fast as the shareholders wanted. What’s a quick and easy way to inflate those share prices? Get rid of 10,000 people. Microsoft, the world’s most valuable company, always insatiable, is incentivized to throw people on the street to increase a few numbers on a screen. Did they bother cutting executive pay and bonuses? Slashing shareholder returns? Did anyone stop to think that the whole concept of infinite economic growth within our corporeal world is a dangerous fever dream? Nope. Throw those superfluous bums in the gutter. The CEO has another mansion to buy.
And the reported tens of thousands of people who have been laid off this year is likely an underestimate of the carnage. Companies hide their true numbers of layoffs by outsourcing employees and hiring people as temporary contractors, often with the promise of future work and benefits that never materialize. This way, once the contracts are over, companies simply cut ties with hundreds or even thousands of temporary workers and then say that it was just the end of the contract, not a mass firing.
“What definitely changed over the past decades has been the introduction of layoffs to boost share prices,” Kai told me. “That just wasn't a thing early on.” With the prioritization of profit and share prices above all other considerations, video game companies are following the same path of “enshittification,” as it has come to be known in the tech industry. Kai points to the widespread detriments that routine mass layoffs have not just on workers but also on the companies. “I can say for a fact that these cyclical layoffs aren't only bad for workers, but for the companies themselves,” they said. “For example, Bioware laid off a significant portion of their employees last fall, and they are now cold-messaging people on LinkedIn trying to hire for positions like short term contract programming. Which likely means that they literally can't finish Dragon Age with the people they have. So when a company lays off workers, they lose institutionalized knowledge and throw their remaining employees into fear based instability which affects performance, but they also clearly do so without thinking about how it's going to impact their active development.”
Companies often argue that they need to cut jobs when an expensive project doesn’t sell as well as predicted. But workers aren’t buying this argument anymore. Regardless of whether or not a game that went through expensive development loses money, Kai argues that this burden should not be placed on the developers. “The reality is that it doesn't matter,” they said. “Developers deserve protections from predatory layoffs and bad workplaces, and there's no amount of cost that justifies those things. I also think that the cycle of layoffs is nonsense on its face; … These companies lay people off that they are going to need to do the work. They don't do it because of performance or costs, they do it because it pumps their stock price.”
This is all representative of shortsighted, industry-wide business practices that can only be considered sane at a financial level because the very human costs, sometimes life-ending, are not borne by the executives, they are forced upon the workers.
“You don’t really feel like a human being” – Current Conditions for Video Game Workers
“This industry took off so fucking fast,” Wayne Dayberry of Zenimax Workers United told me, “I think the morality of it is catching up all of a sudden.” He compared today’s working conditions in the video game industry to the trajectory of the industrial revolution. He said that the combination of a burgeoning, unregulated industry and the “pure passion” of many workers flocking to it created a perfect storm of exploitation. Things took off so fast “that no one took time to put in rules or worried about people getting torn up and stuff,” he said. “It was just this money-producing thing. As long as everything was working, then why stop?”
It's not that different from textile workers and coal miners and stuff. It's like those jobs all of a sudden existed. People needed jobs. So they got them and put up with them because you needed them, but then it got to a point of like, okay, it's been fucking 20 years of this and I've lost three kids into the gears of this machine. There's got to be a fucking end point to that. And I think we've hit that point. … We just took a second to take a breath and, man, this is actually fucking me up being a part of this. Like, why not take the kids-crawling-into-machines factor out of this industry?
Dayberry works in quality assurance (QA), the team tasked with testing games to identify bugs and systemic glitches before they get released. These workers are often the most exploited in the industry. Since QA is generally regarded as an entry-level department, many workers are paid minimum wage, six-day weeks are common, and burnout and turnover are high. “You have to get in somewhere, so the industry knows that they're going to have an unending supply of people that are fueled by passion,” Dayberry said. “So then those people get bottlenecked in a job that, instead of keeping around veterans that know what they're doing, just interchanging people once they've had enough and can't take it anymore.” Dayberry likens their treatment to the toner cartridge in a printer. “We're the thing that just gets replaced,” he said. “You run people until they're burned out.”
Part of what contributes to that burnout is what is known as “crunch,” or overwork, usually in the lead-up to a game’s release deadline. During crunch periods, people work up to one hundred hours per week. Some have had heart attacks at work, lost their marriages, and been pressured to show up even when they’re actively puking from the flu. Some workers call these “death marches.” People who have nervous breakdowns are labelled “stress casualties.” As Dayberry described the Kafkaesque process of dealing with management over bad working conditions such as these, “It’s kind of like a death by a thousand cuts. You don't really feel like a human being, you know?” He points to lack of clarity and transparency from management regarding employee advancement and work/life balance expectations as some of the longtime problems.
There have been many high-profile stories in the video game press about the widespread abuse that employees suffer at the hands of development companies and publishers. And consumers also are realizing that the end product from all this abuse is undercooked games that nickel and dime them in the form of microtransactions and give unsatisfactory gaming experiences. “Games are buggy because people are burned out and overworked,” Kai told me. “Games ship late because companies trim their workforce in order to save money. Games are underwhelming because the creative people who work on them live in fear of losing their job.”
This profit maximization also distorts the kinds of games that developers are allowed to pursue. “I've personally seen, and have heard others attest to similar, that big companies will refuse to do small cheap projects (think $1 million or less) that are almost guaranteed to make a profit, because they wouldn't make *enough* money,” Kai said. “That's insane, right? We've hit a point where if the profit isn't eight or nine digits, it somehow doesn't count.” The result is a hollowing out of the middle, as it were, where the only projects that get made are resource-intensive blockbusters or no-budget indie games.
What we have now is a highly commercialized industry, motivated chiefly by profit, run by amoral executives, and greased with the labor and passion of highly exploited and disempowered game developers. But all that is beginning to change.
There’s Power in a Union
Dayberry has been at Zenimax for seven years and is one of the lead organizers with Zenimax Workers United. A few years ago, he began reaching out to his fellow workers about their grievances and bringing those issues to HR. Those meetings went nowhere fast, and that’s when he started floating the idea of forming a union. “Once everybody knew that they weren't alone, combined with identifying with the suffering of others…it solidified the idea that we were working for,” he said.
Zenimax Workers United is organized under the Communications Workers of America, which has so far won recognition for more than 2,000 U.S. video game workers. The union is currently in the bargaining process for their first contract with Zenimax, recently acquired by Microsoft for $7.5 billion. As Autumn Mitchell, another Zenimax Workers United-CWA member, told Gamespot’s Phil Hornshaw, “I don't know, the same companies that are saying they're making record profits are also letting us know that they can't afford to keep us. Make this make sense.”
The QA team at Zenimax has formed their union in the midst of several other successful unionization efforts in the industry, with QA workers at Raven Software, Blizzard Albany, and Keywords Studios also unionizing. It seems no accident that perhaps the most stepped-on department in the industry is leading the unionization charge. There are signs that many more unions could be forming throughout the industry soon. “Change is definitely on the horizon, when you look at things like the GDC Survey turning up that the majority of game developers now support unionization,” Kai said. Currently, only 5 percent of developers polled have a union.
Having been in the industry a long time, Kai has the historical context to see how these recent first steps at unionization are causing some corporations to change their ways. “Companies themselves (when they aren't laying people off) are working harder to maintain people's work/life balance, remote work has allowed access to significantly more jobs, and the industry is significantly more diverse than it was 20 years ago,” Kai said.
Dayberry has been in contact with workers at other companies and has seen how widespread the discontent is. “The more we've had conversations with people in other studios, it's all kind of the same issues,” he said. “So I think this is just a thing that's been building where everybody that wanted to be a part of this industry, trying to jump on a moving train, are getting all fucked up. And now everybody has collectively reached a point where it's not sustainable anymore. We will not have a video game industry anymore if things keep working like this.”
Kai is clear about the necessary means to achieve a better industry: “There is only one path to stability, and it's the protections offered to employees by forming a union and forming a bargaining contract that gives them power and agency,” they said. “Right now employers engage in layoffs with impunity because they literally have no financial reason to care about employees. But mandatory severance and limits on layoffs enforced by a collective bargaining agreement and job actions would slow that down pretty fast.” Kai insists that coordinated work stoppages and slowdowns “would grind any large development studio to a very sudden and violent halt.”
While those who are choosing to unionize recognize the benefits a union can bring to its workers, they also argue that it’s good for the companies too. Dayberry said, “If the QA department is running on all cylinders, your product's going to be fucking great. And if it's not, it's not going to be good.” He emphasized that Zenimax Workers United-CWA is trying to change the mentality that keeps QA at the bottom of the barrel. “The industry has never been about keeping good people on board. It's just been about having bodies in seats. And we're trying to push towards this new idea of, why not retain skilled employees? Why not make QA a possible career choice rather than just a foot in the door?”
“Unionization is good for companies, they are just too shortsighted to see it,” Kai said. “It would reduce turnover, protect institutional knowledge, and lead to a happier and more productive workforce. This is fundamentally the narrative people should be embracing.”
But the executives in the industry remain unrestrained in their greed, operating with impunity, and accountable only to their shareholders. Electronic Arts, for example, spent $325 million on stock buybacks in just the third quarter of 2023, right before a spate of mass layoffs, and has spent a total of $1.3 billion on stock buybacks over the course of just one year.
I asked Kai what are the most transformative demands that unions could achieve for the industry. “Without a doubt the top demand would be remote work without location based salaries,” they said. “…it allows game developers the opportunity for stability, not having to uproot for each new job.” Kai also emphasized the importance of curtailing layoffs, saying that union contracts should “enforce that layoffs cannot happen if the company is operating at a profit or a temporary (and survivable) loss. The big industry companies like EA do layoffs without real need. EA’s last round of 'restructuring' took them from what would have been a profitable year into a loss. Add mandatory severance to this as a poison pill against layoffs and we can protect jobs from predatory capitalists.”
Zenimax Workers United-CWA is also bargaining to clamp down on the industry’s widespread use of independent contractors in place of hiring people on as employees. “Basically, instead of having contract workers, have something called a ‘temporary employee,’ and it's a role that's going to be less exploitable, more or less,” Dayberry said. They are also interested in more transparency from higher ups about the entire game development process, including resource allocation. “I would have to imagine some way to be able to plan a project in a way that you don't gut yourself,” Dayberry said. “There's no real transparency on our end of what goes into planning it.”
Dayberry points to the domino effect that a good union contract can have on the industry. “It’s inspiration for the next group. If there's a studio out there that has less than 300 people in their department, then they can definitely do it if we could, you know?”
As in other industries, unionization in video games isn’t just about workers taking home their fair share — it’s about dignity. I asked Dayberry what are some of the immaterial benefits that Zenimax Workers United-CWA has so far given him and his fellow workers. “It's changed the culture in the workplace,” he said. “People have the ability – not the ability – they have more of an option to care about each other now, because we can actually do something about it.” Dayberry and the other union members take great pride in what they’ve been able to accomplish at Zenimax. “I kind of found a calling in it,” Dayberry said, referring to his organizing efforts. “I've never been able to pour myself into something. I'm not someone that does shit like this. It surprised me more than anybody else. But it's that fucking rewarding and it feels so fucking good to connect with people, to have genuine conversations and to be able to do something. It's not like we're just getting people more money. We have a voice, and the human suffering level will go down.”
Though Zenimax Workers United-CWA has so far faced relatively little union busting from parent company Microsoft, which went so far as to sign a labor-neutrality agreement, other companies may not be so gentle. Until strong contracts are signed, at-will employment can be weaponized against any potential troublemakers and labor agitators. Nevertheless, workers can’t lose sight of what being without a union relegates them to: utter exploitation.
“Companies fear unionization because they want to pad C-suite salaries and make investors rich,” Kai said, “but they forget that the people who make them their money are the developers. I've personally contributed to the original success of franchises that have made companies billions of dollars, and what did I get out of it? A flat salary that barely rose over my entire career when adjusted for inflation, crippling stress-induced health issues, and ultimately, laid off like everyone else, because some rich capitalist decided that they couldn't make enough money.”
Workers in the industry are fed up with this kind of treatment, and they’re finally starting to do something about it, collectively. “This current generation is less inclined to eat shit on a regular basis than past generations,” Dayberry said. “A big part of what got us going was the younger members in our unit.”
As stalwart labor organizer Jane McAlevey puts it, good union contracts can forever change people’s lives for the better. At the end of our conversation, Dayberry described what it meant to him to be part of the union, and he left me feeling verklempt: “So it just…it feels good to be part of that facet of – shit I don't even know how to say it. Just to be in that group, to be part of that world… I can't put it into words, it just feels fucking really good.”
The Media’s Complicity in Managerial Narratives
While the human toll of these working conditions are staggering, the mainstream media's coverage of the issue has been woefully inadequate. Instead of delving into the systemic flaws of an industry built on exploitative labor practices, news outlets lacking in courage and imagination leave their readers thinking the video game industry is just inherently unstable for its workers, thus keeping the actions of corporate executives relatively free from scrutiny.
Case in point: an interview between NPR’s Ailsa Chang and IGN’s Rebekah Valentine. The two of them paint a picture which is flattering to the CEOs, where we’re told the main causes for mass layoffs are 1) games are just getting more and more expensive to make, and therefore riskier: “You need to have the best graphics, the most content, the most things for players to do,” says Valentine. “And as a result, they take even longer to make. So games that, you know, previously may have only taken two or three years to make are now taking four or five, six, seven, maybe even longer. And therefore the cost is just skyrocketing to make these big games.” And 2) the video game industry “is kind of a fundamentally unstable career,” says Valentine, and this is chalked up to an inherent “culture” of the industry.
To the first point about expense inflation, there is much more to the story. Game publishers and developers constantly argue that they have to spend tens of millions or even hundreds of millions of risky dollars developing games because apparently it is the consumers who push intensive graphics and longer game duration and nebulous “content” to unsustainable extremes. Notice that this excuse puts the blame squarely on the consumers, despite the fact that many gamers have become wise to and fatigued with high-production, bloated games that are produced at enormous personal cost to the people who are forced to work overtime and sacrifice their physical and mental health to make already rich executives even more rich. “Games could be made much more sustainably if companies simply stopped chasing pointless levels of fidelity,” Kai said. I want shorter games with worse graphics made by people who are paid more to work less and I'm not kidding, has become a meme in the gamer community for a reason.
Companies are making literal billions of dollars just on micro-transactions alone, which are cynically designed to manipulate gamers into reflexively and addictively paying for more content just as if they were entranced by a slot machine, and yet those billions of dollars can’t seem to save video game workers their jobs. With astounding profits such as these, the claim that companies can’t afford to keep workers on full time or provide them with living wages and benefits is a cruel joke.
To the second point that the video game industry is just “fundamentally” unstable, why must this be so? Industries are not natural phenomena. Economies are not governed by immutable laws of the universe. They are created through human choices and sustained by certain economic incentives, both of which are given legitimacy by a dominant neoliberal ideology. Executives impose mass layoffs, and they lie to us by acting like their decision to fire thousands of people, while increasing their own salaries and shareholder earnings, was an act of god. They do this not because such actions are fundamental to the industry but because they can get away with it.
There’s nothing inherent or “fundamental” about any of this. An essential aspect of this pro-corporate argument is simply chalking it all up to “culture”:
CHANG: Well, do you think that the culture, then, within the video game industry is just fundamentally incompatible with job security, stability, predictability?
VALENTINE: Yeah.
CHANG: (Laughter).
VALENTINE: Long term, it certainly seems that way.
To say that any industry is “fundamentally incompatible with job security, stability, predictability,” is to be profoundly incurious and dim about the many ways things can be better. Reporters who diminish alternative possibilities to this cruel and unsustainable economic model are presenting a vision of the world which is fundamentally anti-human and pro-corporate.
This is not to say that there isn’t a definable “culture” in the video game industry. The concept of “crunch,” of killing yourself with overwork in order to get the product over the finish line, is indeed driven into worker’s heads. One video game college in Washington is infamous for teaching its students to accept exploitative crunch culture. But to call job insecurity part of the “culture” is to obfuscate the very real, identifiable decisions that powerful executives make to exploit and then unburden themselves of workers. Chronic mismanagement, deliberate attempts to undermine workers and hurt their “performance” as a pretext to firing them, and imposing mass layoffs simply for profit maximization are all part of the executive’s predictable playbook. These decisions have material effects on people’s lives. Grinding workers to dust is not “culture.” It’s the result of a psychopathic economic system.
The Next Waypoint
Besides worker protections that a union can bring, more public funding could be secured to make the arts industries less volatile as a whole. Countries such as France give enormous amounts of state funding to entertainment and the arts. This allows for more risk taking and creativity without the fear of bankruptcy, as well as the diminution of the profit motive.
There is precedent for this in the United States. The Works Progress Administration gave opportunities for radical creators to make a living, leading to a flourishing in public art. The National Endowment for the Arts is an existing mechanism by which we could do this in the U.S., though it must be funded more. Getting rid of the monopoly of corporate and vulture capitalist funding in entertainment would open up space for work that is more experimental, less regimented, and which provides for the livelihoods of tens or even hundreds of thousands of video game workers.
I know that humans are generally blind, stumbling, and amnesiac creatures, but we must not forget that unionized jobs with high wages, good benefits, and guaranteed pensions used to be something that was achievable and sustainable in this country. Unions didn’t kill that dream. Globalized neoliberalism did. The executive class sells us a world where widespread precarity is seen as proper and good. It is our job to demonstrate that they are full of shit. I assure you, billionaire video game executive Bobby Kotick would continue to thrive on zero income for a year (or even the rest of his life!) if that was the alternative to firing thousands of people.
There is no use in trying to persuade the ruling class to be better people. They are constitutionally incapable of doing anything other than what they do. We shouldn’t ask them to make different, more humane choices. We should force them. We should abolish them. We should ensure that they can never exist again. That is our task. We cannot accept the precarity within the video game industry, or any other industry, as immutable or as just a quirky part of the “culture.” This ensures continued immiseration of millions of people. The video game industry does not have a culture of instability — it has a culture of exploitation. The workers know the solution to this.
As Autumn Mitchell of Zenimax Workers United put it, “We have something more certain than luck, something more powerful than hope: We have a union.”