Does WotC even keep part-timers and freelancers for their core product teams? It seems like the RPG industry status quo outside of Wizards is to have a large stable of part-time / freelance / by-the-word staff on-call and string them along with a widely fluctuating volume of work requests (and thus pay) rather than actually make them salaried staff. I mean, you don't call it a lay-off when you suddenly reduce a contractor's workload to something that wouldn't even bring him over the poverty-level but it happens to artists and writers in creative industries all the time.
Wizards does employ many outside freelancers, and has been increasingly. Look at any recent 5E adventure and you are likely looking at freelancers. Now, there is terrific direction from Wizards as to what should be written (and ideas on how), but even the development and editorial work can be in the hands of a freelancer. (Worth noting that these are very amazing freelancers who have decades of experience.)
The problem with freelancing is that it will generally pay far less, forcing most freelancers to either seek a different second job or work relentlessly to get enough work to pay bills. Wizards pays top rates... outside of Wizards you can find $.01/word or even less. The hourly rate on that isn't close to minimum wage. A key problem with our industry is that for most companies, our hobby doesn't generate enough revenue. Freelancing as a solution for RPG companies (and it is a solution for pretty much all of them) is also how the industry keeps many poor while never changing its model.
As Erik Mona says, there can be money in our industry. But it is almost impossible to identify RPG companies that could stay profitable longer than a year or two. Two key issues: 1) Many gamers can and do play without buying stuff and 2) even when we buy stuff we tend to buy less as a product line gets older and more diverse.
The successful companies, including Paizo, don't share the numbers. We don't know, for example, how much of Paizo's success comes from the subscription model, whether splatbooks decline in revenue for them just as they have for all other RPG companies, or anything about the magnitude of their success (it always sounds lean, but it could just be how they keep costs in check). The few RPG companies that share numbers tend to involve a very small number of employees and have total yearly revenues far below what TSR brought in with OD&D!
It would be great if we could see models that work, such that the hobby could be strengthened. Crowdfunding is clearly helping, but it is still very often hiding a labor of love. There are a few exceptions, such as Numenera, but those numbers are still not amazing compared to major (let alone core) products in the late 70s and early 80s (and perhaps recent - we don't know because we lack data from WotC and Paizo). Even with Kickstarters it is hard to know what drives success - I think we all know the key ingredient to the Exploding Kittens card game currently on Kickstarter, and it isn't the business model (unless you consider Fame to be a business model).
This almost looks like they're trying to purge all of the people involved with editions that has problems.
Nope. Everything about 5E shows a healthy respect for previous editions. Nearly all staff have experience across several editions and their best freelancers go way back.
