38 Studios Laying Off Employees
38 Studios has been through a lot over these past 3 weeks. After failing to make a payment to the state of Rhode Island on May 1st, it was looking like the company might be unable to recover from the mess it was in. You know you’re in trouble when you might end up having to shut down and force an entire state to pay off a $75 million loan. The company managed to scrap up the $1.125 million needed to make the late payment, but that doesn’t mean 38 Studios is out of the storm yet.
When the company failed to make payroll last week, the company went ahead and told their temporary and contract employees that they no longer had jobs at 38 Studios anymore. Now it appears that they are firing more people, according to Rhode Island’s Governor Lincoln Chafee. When you consider that 38 Studios was lured to Rhode Island from Massachusetts in an attempt to create more jobs, you can see that there is a problem here.
At this time, there is no news about how many employees will be let go. It’s a shame that a company has to let go of people in these tough economic times, but sometimes that’s what needs to be done. With that being said, however, I don’t see 38 Studios being around in a year, or even 6 months. While another company could buy out 38 Studios and gain their IPs, with the $75 million loan that the company has hanging over its head I don’t see that likely. Instead, the taxpayers of Rhode Island are going to be stuck with the burden, and I wouldn’t be surprised if this fiasco turns up in the election come November.
