Early games needed visuals and that was something results were important, which demo guys delivered on machines with still very limited resources. Formal education for games was lacking behind during the 90th. After all, games as a broad industry was a new concept. (EA once produced games for the C64.)
This has changed. With more and more abstractions and more processing power it is more and more important to work on algorithms not hacks.
Most self taughts lack broader concepts, abstractions and especially algorithms. I had to learn everything besides hacking my way into Frontend development.
Would I look out for folks with no degree? Yes and no. I depends on the use case.
On the other side: the world is filled up with mediocre code from people with degrees. There is no guarantee. Only constant learning - and this is a supoerpower at least some self-taughts have.
As a self-taught who later went to university for pure mathematics (which I got interested in through game programming), that was not my experience with the late 90s, early 2000s generation of self-taught game programmers. I think you have to go back 5 to 10 years earlier for that stereotype to have merit; the transition from 2D to 3D filtered out some people.
In the post-Quake generation, the sexy thing for budding game programmers was 3D graphics programming. For the most part you had no choice [1] but to read, understand and implement SIGRAPH papers and doctoral dissertations to learn the ropes, which in turn forced us to learn a lot of the formal prerequisites albeit unevenly. And there were a lot of advanced data structures involved with visibility determination (and later level of detail), which was the focal point of graphics in the Quake 1 and 2 era before it fell to the wayside once the dominance of GPUs made more brute-force approaches the right choice. So whether you liked it or not, you had to master a decent swath of university-level CS and math.
The main thing self-taughts generally lacked when joining the industry were the same thing all new employees lacked: they don't yet know how to work in teams, they don't know how to manage time, scope and complexity (though it helps if you've worked on larger personal projects of your own), they cannot make long-term engineering trade-offs (reliability, cost of making changes early vs late, flexibility vs performance, etc) because they haven't gone through full project cycles, and so on.
[1] There were a few useful resources like Abrash's Dr. Dobbs articles on Quake which were partially pre-digested for easier consumption by programmers, but it was still daunting if you didn't understand the math. And the rate of progress was so high in this period that the few reliable sources of how-to information were so quickly out of date that you _had_ to keep up with the academic research and experiment by implementing and improving it yourself.
Why?
It's a tough line to walk - as a hiring manager I'd love to talk to every promising candidate no matter what education they have, but equally I also wouldn't want to do the job of recruitment where they take weeks just to sort through the absolute flood of applications that we get.
It seems to me that instead of putting more effort into "sorting through the absolute flood of applications", or perhaps even finding a solution for that problem, HR just ramps the qualification bar even higher disregarding the possibility that higher education is not actually needed, and that talent is not necessarily reflected in any sort of degree. At the same time, it de-values higher education.
You absolutely expect employees having the "best" education, giving 100% and going the extra mile without actually willing to put up the work on hiring talent based on reality.
Ergo: AAA studios are setting up to fail finding talent themselves. Talent without university/college degrees rarely get a chance, so, with enough energy, they start doing stuff by themselves.
I understand that, from economic perspective at least. "Is it worth it?" is a phrase I hear (often also saying myself) a lot when talking about investing time=money in something. I am afraid talent is absolutely worth it, and it's up to the hiring company, not the applicants, to solve that problem.
On the applicants side, especially those who are well aware of their talents, they also think "Is it worth it all? Getting a degree just to be able to apply for positions in big-time companies? I don't think so."
Nobody I know who has gone to a large AAA studio has actually worked on game mechanics or game play in any meaningful way. One poor sod I know, who loved computer games, got tasked with working on the framework for building in-game microtransaction stores into their games.
But it's probably not worth fixing from a boring economic perspective, if you already have too many excellent candidates to employ.
Maybe they'll end up joining/founding indie companies instead of AAA companies
Nowadays even for junior positions we wouldn't consider anyone without at least a bachelors degree in CS, so that's at least 3 years of university - putting the minimum starting age with us at around ~21-22 years old. I myself started just after my masters degree, at 23 years old.
I think that it does mean we are missing out on a lot of very self driven, ambitious candidates - but even requiring a minimum of CS education from candidates we get in excess of 1000 applications for every junior position. I understand why recruitment would be reluctant to start looking at candidates without any formal qualifications.