News came to light on Wednesday from the Twitter account of the Allied Employees Guild Improving
SEGA
(AEGIS) that
Sega
of America plans to outsource both its quality assurance department and parts of its localization departments, ultimately leading to numerous job losses. The company’s plan is to lay off 61 employees by March 8.

The union representing these workers shared in a series of posts that they were able to save over twice the number of jobs initially at risk and provide severance packages to temporary workers.

As of now, there have been no official pronouncements from Sega of America regarding the impending layoffs.

The Game Developers Conference (GDC) announced the outcome of its twelfth annual “State of the Game Industry Survey” on January 18. This revealed that layoffs affected 35% of the game developers who participated in the survey in the previous 12 months. The layoffs were most prevalent in quality assurance departments (22%), and least in business and finance departments (2%). The survey was carried out in October 2023, and it also revealed that 56% of respondents harbored concerns about potential layoffs at their companies in the coming 12 months.

Employees at Sega
of America’s office in Irvine, California decided to
create
a new labor union in July. The employees had submitted a request to the National Labor Relations Board to authorize a union election in April 2023.

The AEGIS union includes a significant number of the office’s staff, spanning several departments including quality assurance, localization, live service, marketing, and product development. This marked AEGIS as the first video game labor union in the U.S. with representatives from multiple departments. With a membership exceeding 200 individuals, it also stands as the largest multidisciplinary labor union in the gaming industry.

AEGIS collaborates with the Communications Workers of America (CWA) and its Campaign to Organize Digital Employees (CODE). In November, allegations arose from CODE and CWA that Sega was planning on laying off 40% of its union members by delegating work overseas.

Sega is renowned for developing several popular game franchises, including Sonic the Hedgehog, Yakuza, Crazy Taxi, Jet Grind Radio, Shenmue, and Virtua Fighter.