Expert Highlights Japanese Studios’ 97% Staff Retention Due to Lower Executive Pay and Resistance to Live-Service Trends

In a recent interview, Amir Satvat, the former Business Development Director at Tencent and creator of ASGC’s Games Industry Layoffs Tracker, shared insights on the impressive staff retention rates of Japanese studios like Capcom, Konami, and Nintendo, which boast retention figures exceeding 97 percent. The secret? These companies make savvy business choices, such as avoiding extravagant executive bonuses and focusing on creating beloved games.

Satvat discussed the ongoing layoffs affecting the gaming industry, drawing from his experience managing the Games Industry Layoffs Tracker since 2022. His data paints a concerning picture, predicting that around 14,500 video game workers could lose their jobs by 2026. However, he also noted that approximately 18,000 to 25,000 new positions are created in the industry each year. This raises eyebrows, as it suggests a net gain of at least 3,500 jobs, which seems counterintuitive given the recent wave of layoffs, including the 1,600 job cuts at Xbox earlier this year, with another 1,600 expected soon after.

This perspective appears to clash with previous comments from Epic Games CEO Tim Sweeney, who warned of an impending crisis in the gaming sector, likening it to the catastrophic video game crash of 1983. Sweeney pointed to an “unprecedented wave of investment in AI systems and data centers” as a potential catalyst for a recession that could mirror the drastic revenue drop of 97 percent in 1985, leading to massive job losses.

So, does Satvat’s data contradict Sweeney’s outlook? It’s complicated, especially when considering Japan’s unique position in the industry. Satvat emphasized that Japan operates under different dynamics, highlighting that studios like Nintendo, Konami, and Capcom maintain high retention rates due to their smaller, more efficient teams and more modest executive salaries—typically in the range of two to three million dollars, rather than the tens of millions seen elsewhere.

Moreover, Satvat suggested that Japanese studios have largely avoided the pitfalls of the live-service model and the trend of massive blockbuster games that require large teams, resulting in fewer financial setbacks. While there are exceptions, such as PlatinumGames’ Babylon’s Fall, the majority of failed live-service titles do not originate from Japanese developers.

In essence, Satvat’s observations imply that the gamble of investing heavily in high-budget projects within a volatile genre can be risky. In contrast, the strategy employed by Nintendo, Konami, and Capcom—focusing on sequels to established franchises—proves to be a safer and more lucrative approach.