You mean like the entire television and film industry? Any production over a certain (small) size is completely unionized. It's so massively successful the American cultural exports dominate in almost every corner of the world.
I'm not sure where the idea that unions can't work for the games industry comes from since it's almost identical to the film and TV industry. Unions exist so workers don't get exploited and to provide stability.
What about Nintendo? They famously have very limited layoffs. They see value in providing stability and maintaing culture and institutional memory.
If anything, it's short-term profit-seeking that destroys industries. You see this in the world of original content production for streamers. They cut the size of writers rooms. They tried to no longer have writers on set. There's a push for "mini writing rooms". Why? Because it cuts costs on a very short term basis.
In doing so, Netflix (etc) are intentionally throwing away the model that created billion dollar properties like Friends, Seinfeld, ER, MASH, Cheers, etc that, to this day, generate massive profits. Seinfeld was known for getting over a million viewers when it was running in syndication.
Long-term it creates problems. Future products and showrunners are writers who need to get experience on set. Shortsighted cost-reudction is literally killing the future of the industry.
As for the price of video games, there are several aspects to this:
1. AAA publishers like to complain that games still cost $60 after years. That's true but also the distribution is significantly higher than it was 20 years ago. You're selling way more games;
2. The marginal cost of producing a game via download is essentially zero; and
3. Games eventaully get much cheaper on Steam. That's a good thing. Early experiments with this showed that selling a game cheap on Steam could generate significantly more revenue than the original release. And because the marginal cost is zero, it's all profit.