During a time of employee uncertainty throughout the gaming industry with corporations like Microsoft and Riot Games conducting mass layoffs, Japanese games companies like Nintendo and Sega seem to be taking different approach to increasingly uncertain financial times. With Japanese Prime Minister Fumio Kishida’s call for companies to increase wages to combat growing inflation, Nintendo has promised to increase average employee wages by 10%, and Sega has joined them with an even greater average salary raise of 30% effective July 1.
According to a report by Sega’s parent company, Sega Sammy Holdings Inc, this move is being made so that Sega can “invest in human resources in order to further stabilize employee income and create a more comfortable working environment,” and also “further strengthen its global competitiveness.” This will be accomplished by “raising the base salary and increasing the ratio of base salary within annual salary by incorporating part of bonuses.” Through this revision, initial monthly salaries for university graduates will go up 35% from ¥222,000, or $1,646, to ¥300,000, or $2,224. For annual salaries, these new policies will result in an average increase of approximately 15% throughout the company.
This company-wide wage increase may also be the result of Sega’s pleasure with the success of their latest premium title, Sonic Frontiers, as expressed in a recent Q&A with investors translated by TailsChannel:
We have been able to achieve these results while maintaining a certain level of quality, and the number of units sold greatly exceeded our original estimation. We will continue to sell over the long term based on sales strategies such as pricing, promotions, and the development of further DLC.
Sega also stated that due to Sonic Frontiers‘ popularity and acceptance by “a lot of people around the world,” that Sega will continue to commit to investing in the Sonic franchise, including through higher budgets for future Sonic titles:
We expect development costs for new titles to grow even larger in the future. We will strive to ensure solid quality in the development of major titles from our existing franchises… Since it is necessary to take on these challenges for major titles, we are proceeding with a bigger budget, even from the basic research stage. Therefore, we assume that development costs for future new titles will increase accordingly.