Nintendo president Satoru Iwata has stated that laying off staff may lower overheads, but it will affect morale. He feels the fear of being laid off will affect the ability of employees to develop games that impress people.
"If we reduce the number of employees for better short-term financial results employee morale will decrease and I sincerely doubt employees who fear that they may be laid off will be able to develop software titles that could impress people around the world," Iwata told investors.
"Regarding why we have not reduced the number of the personnel, it is true that our business has its ups and downs every few years," Iwata added, "and of course, our ideal situation is to make a profit even in the low periods, return these profits to investors and maintain a high share price."
"We should of course cut unnecessary costs and pursue efficient business operations," Iwata continued. "I also know that some employers publicize their restructuring plan to improve their financial performance by letting a number of their employees go, but at Nintendo, employees make valuable contributions in their respective fields, so I believe that laying off a group of employees will not help to strengthen Nintendo’s business in the long run."
"Our current policy is to achieve favourable results by continuously cutting unnecessary expenses and increasing business efficiency," concluded Iwata.