After a “very difficult” year for the video games industry, 2024 promises to be even worse. In just one month, more than 6,000 layoffs have already been announced globally, almost surpassing the number of layoffs recorded last year.
James Russwurm, who lives in Edmonton, is among the thousands of employees who lost their livelihood in the past year. He worked as a video game tester and quality control analyst at Keywords Studios.
When the announcement of the layoffs came last September, his small team was carrying out contracts for the Californian giant Electronic Arts. He and his colleagues had also worked for the Edmonton studio BioWare, well known for its successes Mass Effect et Dragon Age.
Imagine experiencing that. You arrive at work and your manager tells you in a meeting: today is your last day, goodbye, he remembers. All access to the dozen dismissed employees was revoked immediately after this meeting.
It’s not really an industry in which we can build our careers or fully invest ourselves.
His employer had explained to him that he was unable to conclude a commercial agreement with Electronic Arts, without giving further details. James Russwurm suspects his team’s decision to unionize just a year earlier surely played a role in that decision.
This seems like an anti-union tactic to me. Maybe they think they can get rid of us to avoid dealing with unionized employees, he says.
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Last September, James Russwurm lost his job as a quality control analyst at Keywords Studios, an Irish company with an office in Edmonton.
Photo : Radio-Canada
The bleeding of jobs continues
This wave of layoffs in the video games industry is part of a real drain on jobs in the technology sector, which is continuing this year.
Techno columnist Carl-Edwin Michel explains that, just like online commerce and social networks, video games experienced a boom during the pandemic, which pushed production companies to hire massively and invest in new technologies , such as virtual reality and the metaverse.
Unfortunately, it didn’t produce the expected results, he said. These are publicly traded companies. If the performance is not there, we must readjust the shot quickly.
It’s heartbreaking, but we don’t really think about humans. We are thinking more about the pockets of investors.
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Tech columnist Carl-Edwin Michel is also founder of electronic sports company Northern Arena and executive producer of the Canadian Games Awards.
Photo : Radio-Canada / Cristian Gomes
Last week, the giant Microsoft announced in an internal memo that it planned to cut 1,900 positions from its subsidiaries Activision-Blizzard, Xbox and ZeniMax, or 8% of its entire video games division. Most of the layoffs will affect Activision-Blizzard, which the company swallowed last October in a monster transaction valued at 69 billion US dollars.
We defined our priorities, identified duplication and ensured that we were all aligned on the projects with the greatest potential to generate growth, underlined the head of video games at Microsoft, Phil Spencer, in his message sent to employees , last Thursday.
The editor of League of Legends, Riot Games, announced the elimination of 530 jobs, which represents 11% of its workforce. CEO Dylan Jadeja pointed out that the company had more than doubled its workforce in a few years – to reach 4,500 employees – and that with too many projects underway, it must refocus its priorities.
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Riot Games, behind the game League of Legends, laid off 530 employees in January, after growth in its workforce deemed unsustainable, explains CEO Dylan Jadeja.
Photo : Riot Games
This is absolutely the last thing we wanted to do, he wrote. A decision like this has a huge impact on people’s lives and Riot’s culture. We’re not doing this to appease shareholders or boost our profits – we made this decision because it’s necessary.
Earlier this month, live streaming platform Twitch said it plans to let go of about a third of its workforce, or 500 employees. The company that launched the Unity game engine, which has an office in Montreal, has announced 1,800 layoffs, or a quarter of its workforce.
The impact of artificial intelligence
In the coming years, artificial intelligence could also change the situation, according to experts, although this reason is not explicitly mentioned by companies. With artificial intelligence taking up a lot of space, it will have an impact in the world of video games, says Mr. Michel.
According to him, these powerful tools could replace the actors who lent their voices to the characters and the teams who developed these characters and their environments.
AI is capable of producing much more, much faster, he emphasizes. Are we going to see more and more of this type of layoffs? We’ll see.
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Jayson Hilchie, President of the Entertainment Software Association of Canada, represents major video game console manufacturers, publishers, independent developers, as well as national distributors.
Photo: Radio-Canada Nicholas De Rosa
The president of the Entertainment Software Association of Canada, Jayson Hilchie, remains rather optimistic. These layoffs don’t tell the whole story, he said.
Even with these very unfortunate layoffs, we’re still probably at the highest employment level we’ve seen since the pandemic, he says.
Mr. Hilchie points out that the video games industry contributed $5.5 billion to the Canadian economy in 2021. In terms of jobs in this sector, Canada was ranked third in the world.
Can a union help?
Working in the video games industry is stressful for Vlada Monakhova, an illustrator and conceptual artist in Montreal. The freelancer joined the Game Workers Unite (GWU Montreal) group, which aims to promote the rights of workers in the video game industry and support their unionization efforts.
There is simply no security. There is no way to plan our future.
At any given moment, I can receive an email saying that I am no longer needed, she says.
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Vlada Monakhova, member of the GWU Montreal group
Photo : Radio-Canada
The union movement within the video game industry is still very embryonic in the country, but according to James Russwurm, recent cuts demonstrate the importance of protecting workers.
In 2022, he was one of 16 Keywords Studios employees to join the United Food and Commercial Workers (UFCW) Local 401. It was a first in Canada.
However, he believes that protections for workers’ rights in the video game industry in the United States are still stronger than on this side of the border.
We want to implement several of these protections for our workers so that we avoid these waves of hiring and layoffs, explains James Russwurm.
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Carl-Edwin Michel, founder and executive producer of the Canadian Game Awards, understands that the cyclical nature of producing new games makes life difficult for these artisans with very specialized skills.
He suspects the release of a new Switch console, expected this year, and the development of new versions of the PlayStation and Xbox gaming systems should boost employment.
There, we are slowly starting to see companies that will focus on creating games for these new generations, so this will lead to new projects and, possibly, new hiring.
With reporting from CBC’s Shawn Benjamin and Alison Northcott
2024-01-30 21:20:02
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