Younger Americans are spending 25% less on video games today than this time last year.
That’s according to a report by The Wall Street Journal, which used data from market research company Circana to analyze the spending habits of young Americans.
While spending was down 13% across the board from January to April 2025 for 18- to 24-year-olds — particularly on accessories, technology, and furniture, which fell by 18%, 14%, and 12%, respectively — video game spending saw the largest fall. This is not a trend observed in older age groups.
Spending also dropped in the categories of prestige beauty, clothing and apparel, and sports equipment.
The WSJ posits that “a combination of economic challenges is driving the decline,” with graduates struggling to find employment and credit card delinquency rates highest for 18- to 29-year-olds.
“Young grads are having a much tougher time finding jobs,” the report reads. “Student-loan payments are restarting for millions of borrowers. Over roughly the past year, credit-card delinquency rates have risen to their highest points since before the pandemic, and are highest for those 18-29, according to the New York Federal Reserve.”
It’s worth noting that the time period featured in the study does not include the June launch of the Nintendo Switch 2, which will boost the figures. And next year’s launch of Grand Theft Auto 6 is expected to set records for consumer spending not just on video games, but all of entertainment.
Meanwhile, the cost of gaming has gone up, with some publishers moving to $80 for video games, consoles rising in price, and in-game monetization becoming more aggressive. Circana’s Mat Piscatella took to social media to say people are still turning up to play video games, “but engaging more with free-to-play on devices they already have access to.”
The report comes at a time of great instability across the games industry despite record profits. Around 2,800 game devs have lost their jobs in the first half of 2025 alone, on top of 14,600 cuts in 2024, and 10,500 in 2023.
That 2025 figure does not include yesterday’s shocking news that Microsoft plans to lay off around 9,100 people, with some of the cuts hitting Microsoft’s gaming business. It laid off 1,900 staff in January 2024, then made further cuts just a few months later when it closed Redfall developer Arkane Austin and Hi-Fi Rush developer Tango Gameworks. In September 2024, Microsoft cut a further 650 staff from its gaming business. And in May this year, Microsoft cut an eye-watering 6,000 staff, or 3% of its entire workforce.
In the same message that informed staff about the cuts, Xbox boss Phil Spencer said that he “recognize[d] that these changes come at a time when [Xbox] have more players, games, and gaming hours than ever before.”
Photographer: Ariana Drehsler/Bloomberg via Getty Images.
Vikki Blake is a reporter for IGN, as well as a critic, columnist, and consultant with 15+ years experience working with some of the world’s biggest gaming sites and publications. She’s also a Guardian, Spartan, Silent Hillian, Legend, and perpetually High Chaos. Find her at BlueSky.
