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Video game developers meet reality: Joblessness

After a decade-long industry boom, many developers find themselves suddenly out of work.

March 28, 2009|Alex Pham

SAN FRANCISCO — Since landing his first job in the video game industry in 1992 as a salesman at Capcom Co., Justin Berenbaum never wanted for work -- until this month.

The 39-year-old from Woodland Hills was laid off from his job as vice president of business development at EmSense Corp., a San Francisco game design consulting firm. A few days later, he was roaming the halls of the Game Developers Conference in San Francisco, browsing the career pavilion and hitting up former colleagues for leads.

"For the first time in 17 years, I have no idea what my next job will be," Berenbaum said. "Given how bad the economy is, I'm a little worried."

What a difference a year makes. After a decade-long boom, hiring in the video game industry slowed dramatically in late 2008 as consumers curtailed spending and credit dried up.

Electronic Arts Inc., or EA, a large video game publisher in Redwood City, Calif., has cut 1,100 jobs since October. THQ Inc., based in Calabasas, said in February that it would shed 600 jobs, about a quarter of its workforce. Chicago-based Midway Games Inc. in December said it would lay off 25% of its staff, about 180 employees.

The three posted large losses last year as their titles failed to sell well enough to cover the ballooning costs of developing games.

Companies are starting to loosen the purse strings, if tentatively, and hire again as video game sales remain relatively strong despite the recession. As they fire some workers, they're bringing in others for different projects. Even EA, which slashed 11% of its workforce last year, currently has 250 openings.

"Companies still hire for critical jobs that they need to fill," said Cindy Nicola, EA's vice president of talent acquisition. "There are pockets of our business that are still growing, so we add resources to those areas, even as we let go of people in other areas."

About 50 companies came to the conference's career pavilion at the Moscone Center this week, down from 55 last year, when recruiters resembled carnival buskers hawking their wares.

One of those companies this year was Realtime Worlds Inc., a game developer from Boulder, Colo., that was looking for 40 people to work for a year finishing up a game at its studio in Scotland.

Late one afternoon, Realtime Worlds' executive Ray Miller reached beneath a table in his recruiting booth and pulled up his haul: a canvas shopping bag stuffed with more than 200 resumes. One was elaborately wrapped in a colorful cloth pouch and tied with ribbon.

"We've been so busy talking to people that we haven't even touched our lunches," Miller said as he prepared to head back to his hotel to spend the night sifting through his trove. "Last year, we had two people to staff the booth, and there was more downtime. This year, we have four people, and we haven't had a break all day."

For companies, that's one silver lining of the economic downturn: After years of not being able to find enough qualified people to make games, employers now have a surplus of out-of-work talent from which to hire.

But the brutal competition for jobs is weighing on even experienced developers, who are having a tough time landing full-time gigs.

Yasuhiro Noguchi, a San Francisco developer with 15 years in the game industry, was laid off last month as director of product development at Red Mile Entertainment Inc., a game developer in Sausalito, Calif.

"So far, it's actually kind of bleak," said Noguchi, 40, who also has worked for Namco Hometek Inc. and Sega Corp. and is fluent in Japanese.

He has been able to land small contracting jobs, because the game industry continues to grow. In the first two months of 2009, sales jumped 11% in the U.S. compared with a year earlier, when the economy was not in distress, according to research firm NPD Group.

Last year was even better, with sales growing 19%. But not all companies benefited from the boom. Those with hit games, including Ubisoft Entertainment and Activision Blizzard Inc., did well. Others, including EA and THQ, lost money, canceled projects and laid off staffers.

Some have started to hire again, as they rush to complete games scheduled for release this Christmas season. With most game companies' fiscal years ending at the end of March, the dawn of a new financial year also offers a glimmer of hope, said Justin Stark, general manager of Digital Artist Management, a recruiting firm in El Segundo.

"Consumers still have an appetite for entertainment," he said.

He noted that developers with experience in software programming, digital arts and social networking and Web technologies are still in demand.

"I've got well over 100 jobs I need to fill, and I'm just one recruiter," said Marc Mencher, president of Game Recruiter in Fort Lauderdale, Fla. "It's just that the companies are getting very picky.

"Everyone's watching their money."

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alex.pham@latimes.com

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