It's supposed to be that way. There are other pieces that keep the arms where they're supposed to be when in use.
Please don't go banging on it with a hammer.
The shifty bits in a Suzuki GS500 (and many other bikes) look a lot like that, and basically there's a plate over the end of the shift drum that keeps the "hooks" at the end in the right place. The side-to-side play is of no consequence, and some play is needed to ensure the assembly moves freely under load.
Also, you have omitted some VERY important information, like what sort of machine you're working on and whether you are having any other problems that would lead you to suspect this part.
1983 Suzuki GS850G, Cosmic Blue
2002 Suzuki Vstrom DL1000, Midnight Blue
2005 Kawasaki KLR685 - Turd II.2, The ReReTurdening
"Do not crinkle your food wrappers loudly. Be considerate to others, or I will bite your torso and give you a disease."