A "significant" number of workers were laid off today at Mafia III developer Hangar 13, Kotaku reports.

The studio has apparently spent the past year chasing ideas for its next project, which included prototyping a third-person action game with a "fight to music" system where your moves would create songs.

A spokesperson from Hangar 13 owner 2K confirmed to Kotaku that "there have been staff reductions at Hangar 13 in order to ensure that the studio's resources are properly aligned with its long-term development plans".

"These reductions will not influence 2K's ability to create and deliver its products that are currently in development.

"We never take these matters lightly, and are working with the affected employees to support them and explore potential opportunities throughout our organisation."

It isn't clear how many people lost their jobs, but Kotaku sources claim "a large proportion of Hangar 13's staff" are now unemployed.

It is estimated that 150 people were employed at Hangar 13 in 2016.

A highly anticipated sequel, Mafia III launched in October 2016 to somewhat middling reviews.

Gameplanet reviewer Baz Macdonald described it as "a great step forward for storytelling in games that is dragged down by its consistently unpolished and poorly executed mechanics".

Even so, the game was a commercial success for publisher 2K, with more than five million copies shipped to retail as of early 2017.

It was California-based developer Hangar 13's first game, and last year, Mafia and Mafia II developer 2K Czech merged with the studio.