The video game industry, once characterized by perpetual growth and a "gold rush" mentality, is currently navigating its most turbulent period in decades. With tens of thousands of professionals displaced by widespread layoffs and studio closures, the sector is undergoing what many analysts describe as a painful "industry reset." As the headlines continue to be dominated by shuttered projects and departing talent, the focus is shifting from the economic mechanics of these cuts to a more pressing, existential challenge: how to support the people who remain.
The burden of this transition falls squarely on the shoulders of Human Resources (HR) departments. Tasked with managing the logistical nightmare of redundancies while simultaneously maintaining the morale of a demoralized workforce, HR professionals are finding themselves on the front lines of a cultural crisis. Ahead of the GamesIndustry.biz HR Summit scheduled for October 1, we spoke with industry experts to unpack the long-term human implications of this downturn.
The Invisible Weight: Understanding the "Survivor" Experience
While the immediate shock of job losses is often the primary focus of industry reporting, there is a quieter, more pervasive struggle unfolding within the walls of surviving studios. Emma Smith, former HR lead at Creative Assembly and current consultant at Hestia Talent Partners, argues that the industry has overlooked the emotional attrition of those who remain employed.
"We have quite rightly talked a lot about the people who have lost their jobs, but maybe not enough about the people who are still there," Smith explains. "There are people in the industry who have now been through two, three, or even more rounds of layoffs. They’ve watched so many people lose their jobs, seen projects cancelled and studios close, and in some cases spent many months wondering if they were going to be next."
This cumulative trauma creates a profound sense of instability. The narrative of "stability returning" is often met with skepticism by employees who have seen that stability vanish overnight in the past. Smith suggests that studios cannot simply pivot back to business-as-usual; they must actively rebuild a foundation of trust. This, she notes, is not a matter of "manufacturing buzz" or toxic positivity, but of radical honesty and consistent, integrity-driven leadership.
A Chronology of Uncertainty: The Shift in Market Power
The landscape of the games industry has shifted dramatically over the last three years. In the post-pandemic boom, the market was heavily employee-driven, with aggressive hiring and competitive salaries. Today, the pendulum has swung back toward employers, with a scarcity of roles and a heightened focus on corporate survival.
Michael Elliott Chan, Head of People and Operations at Compulsion Games, has observed a marked change in the psychology of his staff. "At one point, we were in more of an employee-driven market, but things have shifted back toward employers," Chan observes. "I’m seeing employees take more precautions—building nest eggs, strengthening emergency funds, and thinking proactively about how to survive an unexpected downturn."
This shift has changed the nature of professional conversations. Where once employees might have prioritized creative growth or equity, the conversation is now centered on job security and the "safety net." For leadership, the challenge is to manage this anxiety without stifling the creative passion that defines game development.
Strategies for Resilience: Controlling the Controllable
When the industry news cycle is dominated by daily reports of layoffs, how can leadership offer meaningful reassurance? Chan advocates for a philosophy of "controlling the controllable."
"Communicating intentions regularly is important because it helps people focus on what they can control: doing great work and supporting each other," says Chan. This approach requires an "open-door" policy, where leaders are not merely present but are actively listening to the "quiet" members of the team—those who might be retreating into silence as a defense mechanism against stress.
The Foundation of Trust Over Motivation
Smith emphasizes that trust must precede motivation. In a cycle of repeated restructuring, morale is fragile. "People aren’t going to be reassured simply because someone tells them everything is going to be fine," she says. "Reassurance comes from honesty, consistency, and following through on what you say you are going to do. If circumstances change, be honest about that, too. When people start to trust what they are hearing and experiencing again, motivation has something much more solid to build on."
Redefining Professional Growth in a "Flat" Industry
As studios tighten budgets, the traditional "career ladder" is often the first casualty. However, Smith suggests that the industry must broaden its definition of professional development to maintain engagement among staff who feel their growth has stalled.
"It isn’t always a training course, a promotion, or another rung on a career ladder," she explains. "It can be deepening the skills you already have, gaining experience adjacent to your discipline, working with another team, mentoring somebody, or taking ownership of something new."
The key, according to both Smith and Chan, is transparency. If a promotion is not financially feasible, leadership should not attempt to "dress up" a lateral move as a promotion. Instead, they should foster open dialogue about what growth looks like in a lean environment. This honest approach prevents the cynicism that often sets in when employees feel they are being misled by corporate messaging.
The Emotional Toll on the People Professionals
It is a frequent irony that the people tasked with supporting everyone else—HR professionals—are often the least supported themselves. The emotional labor involved in facilitating layoffs, while potentially fearing for one’s own job security, has created a burnout epidemic within the HR community.
"HR people are human too," Smith points out. "They have been supporting people through redundancy processes while knowing their own role could be at risk, and still trying to handle that process with integrity and heart."
The nature of HR work has become largely reactive, shifting away from long-term culture-building toward the immediate, painful demands of restructuring. Smith encourages her peers to lean into support systems—employee assistance programs (EAPs), professional networks, and trusted mentors. "There can be a tendency in HR to carry the emotional weight of everyone involved, and that isn’t sustainable," she warns.
Implications for the Future: A Human-First Industry
As we look toward the future, it is clear that the "old way" of managing game studios is no longer viable. The industry’s reliance on rapid expansion has left it vulnerable, and the current reset is exposing the weaknesses in corporate culture.
Chan stresses that the "human" aspect of HR is more vital now than ever. In an era of AI-generated communication and impersonal mass-layoff notifications, the value of the human connection cannot be overstated. "In a changing landscape where people are receiving AI-generated communications and are being bombarded with news of layoffs, anchoring the business in a people-first mindset is critical," he says. "That means being proactive about listening, addressing concerns consistently, and creating real opportunities for connection."
Practical steps, such as regular listening sessions, frequent team surveys, and intentional in-person interactions, can help mitigate the feeling of being a "cog in the machine." By celebrating milestones and recognizing individual contributions, studios can prevent the environment from feeling like a perpetual state of "doom and gloom."
The Verdict on Culture
Ultimately, the current crisis serves as a crucible for corporate values. It is easy to foster a positive culture during periods of growth and high profit, but a company’s true character is revealed during times of hardship.
"It’s what you do when things are difficult and uncomfortable that tells people what your culture actually is," Smith concludes. She suggests that the industry should stop pining for a return to the market conditions of six years ago. That era is gone. The focus must now be on learning from the trauma of the last few years and building an industry that is not only more resilient but fundamentally more human.
The upcoming GamesIndustry.biz HR Summit aims to facilitate this necessary conversation. By focusing on personal resilience, ethical leadership, and the future of work, the event represents a pivotal moment for those charged with holding the industry together while it attempts to find its new equilibrium. As the sector moves forward, the success of these companies will be defined less by their release schedules and more by how they treated their people when the lights were dimmed.
