Layoffs at Epic Games

The season of mass layoffs is yet to slow down and an announcement of layoffs at epic games took place. On September 28 Epic announced via a post that they will be cutting down around 18% of workforce.

Reason Behind the layoffs at epic games ?

The reason behind layoffs as mentioned in the post is as follows:

We’re divesting Bandcamp and spinning off most of SuperAwesome. For a while now, we’ve been spending way more money than we earn, investing in the next evolution of Epic and growing Fortnite as a metaverse-inspired ecosystem for creators. I had long been optimistic that we could power through this transition without layoffs, but in retrospect I see that this was unrealistic.

What benefits do the employees get ?

To be true when I read it, It looks better than some other companies where you are forced to resign or be terminated. Here is a mention about the same in the post:

Saying goodbye to people who have helped build Epic is a terrible experience for all. The consolation is that we’re adequately funded to support laid off employees: we’re offering a severance package that includes six months base pay and in the US/Canada/Brazil six months of Epic-paid healthcare. We’re offering to accelerate people’s stock option vesting schedule through the end of 2024 and are giving two additional years from today to exercise the options. In the US we’re also offering to vest any unearned profit sharing from their 401k. And we’ll provide benefits including career transition services and visa support where we can.

Is there any scope for additional layoffs ?

Well if it started and happened once it can happen again even though they mentioned differently in their FAQs

• No. These changes financially stabilize the business.
• The entire goal of this process was to make our cost structure more sustainable and we believe that we have achieved this. 

We have seen this happen time and again with other organization with much better financial output and cushion. Not claiming or saying it will happen again but its better to be mentally prepared rather than be surprised at the outcome.

Aggressive hirings during Covid 19

Lets have a look at the statistics as is available on the Internet. The company hired at a higher pace and can be visible from the following graph:

Another interesting tweet kind of verifies the same. Big decisions like these made behind closed doors cause troubles like these.

Meta did the same chasing a stupid dream of metaverse now this. Not sure when people shall get over this idea.

Aftermath

Well, since this has become culturally accepted ritual of bulk layoff and this doesn’t really stand out so it is ok to do it. Its the employees that suffer. Its not just the 900 people who suffer their family is also made part of it.

I do like Epic and I do like Unreal engine and their vision of going next gen but layoffs I do not think should be made a solution to have an easy way out. Sustainable growth should be preferred over overnight temporary growth.

This is just going to add more pressure to the existing thin market of hiring that is going on. Inflation is a curse to be true.

On a personal note being part of the epic community and having being affected by layoffs personally I hope everyone stays strong and is able to be rehired again. I am sure you will succeed. Gaming industry is one of the toughest to survive in terms of software complexity and challenges.