Japanese studios weather industry layoffs better with smaller teams and lower executive pay

The video games industry has faced unprecedented job losses in 2026. Microsoft announced 3,200 layoffs across Xbox, while Bungie, EA, PUBG Productions, Take-Two, Warner Bros., and Epic have all conducted significant staff reductions. Yet Japanese studios have remained comparatively stable.

Amir Satvat, who has tracked industry layoffs since 2022, identified structural differences between Japanese and Western game development as the key factor. "Japan is a completely different ballgame," Satvat told Edge magazine. When Japanese studios need to cut costs, they typically reduce contractor positions outside Japan rather than eliminate core local staff.

Major Japanese publishers maintain exceptional staff retention. "Everyone calls out Nintendo, but you can look at Konami or Capcom – these companies all have staff retention of 97 percent plus," Satvat said. He attributed this resilience to three factors: smaller, leaner team structures; avoidance of the live-service and mega-blockbuster trends that drove massive hiring in the West; and significantly lower executive compensation.

Executive salaries illustrate the disparity. Japanese gaming executives typically earn between two and three million dollars annually. By contrast, EA CEO Andrew Wilson received $38.6 million last year, and Take-Two's Strauss Zelnick earned $42.1 million in 2022. Both companies laid off staff in 2026.

The scale of Western job losses is stark. Between 2022 and 2026, 57,628 jobs were lost industry-wide, with 96 percent occurring in North America and Europe. Satvat estimated that over half of all global layoffs during a 12-to-18-month period occurred in California alone. "I think this is as bad as the '83 crash if you're a game developer based in North America or western Europe, in a traditional triple-A studio," he said.

Japanese publishers have avoided this devastation while maintaining commercial success. Capcom released Pragmata, Resident Evil Requiem, and Onimusha. Nintendo has broken sales records consistently. Koei Tecmo explicitly stated its belief that smaller titles will fuel continued success.