Stop Praising Corporations For Doing The Bare Minimum

Yesterday, Riot Games announced that it’s laying off 530 employees globally – roughly 11 percent of its workforce – and shutting down Riot Forge, the smaller arm of Riot that works with other developers to create single-player games like The Mageseeker, Song of Nunu, and the upcoming Bandle Tale. The team behind Legends of Runeterra has also been affected by the layoffs, and is shifting its focus to the ‘Path of Champions’ PvE game mode.

In a post to the official Riot Games website, CEO Dylan Jadeja said that the company had “jumped headfirst into creating new experiences and broadening our portfolio” since 2019 and had doubled the size of the company within those few years. Now, he says, the company has “too many things underway” and that “some of the significant investments we’ve made aren’t paying off the way we expected them to”.

Despite instituting hiring slowdowns and freezes over the last few months, Jadeja writes, the company’s costs have “grown to the point where they’re unsustainable” and there’s “no room for experimentation or failure” left. He then insists that Riot did not want to do these layoffs and acknowledges the impact of this decision on people’s lives, and that “we’re not doing this to appease shareholders or to hit some quarterly earnings number”, and layoffs have to be done because “it’s a necessity”.

"At Least They Have Support!"

We are all now very used to seeing layoff announcements with absolutely no warning and no benefits afforded to those who have lost their jobs. Riot Games has offered its fired employees a level of support we rarely see in other layoffs: a minimum of 6 months severance pay, cash bonuses, health benefits through to their last day of employment, and cash coverage for their lost “play” and “wellness” funds. They can also keep their equity in Riot, will receive a laptop if they need one, will have access to job placement services for 6 months, and will have access to trained counselors for three months after leaving Riot. They also won’t cut off email access immediately so former employees have the time to deal with the admin that comes with disentangling yourself from a company.

These benefits are a good thing. Laid off employees should be treated with dignity and given support and resources to deal with the life-changing impact that losing a job, their source of income, will bring. What isn’t a good thing is that people on social media are praising Riot for their ‘generosity’ and calling the severance packages a ‘nice gesture’. It’s incredibly distasteful to be saying these companies are rescinding the livelihoods of their employees in a ‘nice’ way, but even more than that, it’s distasteful to praise a company for doing what they should be doing.

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Through reading social media posts from laid off Rioters, it’s become clear that there are many factors that people praising Riot aren’t taking into account. For one, Riot did not inform its employees that they were being laid off until after the public announcement was made, meaning that many employees found out they were being fired from social media. They had to wait to find out if they still had jobs for at least an hour, which is quite a cruel thing to do to your employees.

Then there’s the fact that people who joined the company during the pandemic hiring boom, like this ex-Rioter, had to uproot their lives and families to move to Los Angeles when Riot instituted a return to office policy in 2022 for those working at its HQ. Los Angeles is one of the most expensive cities in the United States. Consider, also, that some people had to move from different countries to work for Riot, and their visas to live in the United States are tied to their jobs. While Riot offers support for those employees, it’s an extra level of immediate stress for employees who moved their entire lives to a different country to work for a company that ultimately laid them off.

As I do every layoff, I am thinking of Satoru Iwata and the Nintendo board of directors who took significant pay cuts in 2011 to ensure Nintendo employees didn’t get laid off. I do not believe that Riot truly exhausted all their options.

Layoffs Will Keep Happening

In 2023, it was estimated that over 9,000 people in the games industry lost their jobs. Earlier this month, just Twitch and Unity combined laid off 2,300 employees. Discord faced layoffs as well, as did the Gearbox-owned developer Lost Boys Interactive, and Dead by Daylight developer Behaviour Interactive, among many others. As of Kotaku’s count, at least 3,892 people have been, or will be, laid off this year, and the first month of 2024 isn’t even over yet. We are quickly approaching the halfway mark of last year’s layoff numbers, and January isn’t even over yet. Almost every company is suffering, so the developers getting laid off have nowhere to go, and no jobs to apply for.

This will only continue to happen. An article from GamesIndustry.biz interviewing games industry leaders revealed that 2024 is going to be a year of games company closures, because there are simply “too many unprofitable businesses in video games”. Another publisher boss said that “Too many games were green lit in 2020 and 2021” and that companies need to “get to pre-pandemic levels in terms of the release schedule”. Another said, “The expansion and investment over COVID has left engagement-based businesses, not just video games, spread too thin. We're doing too many things that aren't delivering.” Essentially, executives made bad business decisions during the pandemic, and the employees they hired are suffering now for it.

Read that again: it’s not the executives who are being punished for their bad decisions, it’s the people they employed.

These layoffs, no matter how cushy the severances, are because of blatant mismanagement and out of control expansion. It’s the same story every time. We saw it with Embracer, and Epic, and every other layoff of 2023. Chasing profit and infinite exponential growth led to bad choices, and the industry is now suffering as a whole because of it.

These layoffs and closures are unlikely to stop in the next year, or maybe even the next two years, while things return to the baseline they were at before. We should therefore be holding companies to a higher standard instead of praising those who deign to treat their employees like human beings. What Riot did was treat its employees like human beings, and the fact that we see this as revolutionary and unheard of only points to how bleak it is to work in the games industry right now. We expect laid off employees to be sent off with nothing but a pat on the back, and that we’ve gotten to this point says so much about the reality of working conditions in this current era of capitalism.

What Riot has done is only special because every other company is so disappointing. Don’t praise it for doing what it should have, ask why nobody else is meeting that bar.

There Is No Voting With Your Wallets When It Comes To Game Industry Layoffs

It's good to refuse to buy games from companies you don't want to support, but don't expect the decision to have an impact.