From the Wall Street Journal:
“Amazon.com plans to announce thousands of corporate job cuts across the organization as early as Tuesday, according to people familiar with the matter, the latest cost-cutting move for the tech giant that is seeking to slim down and conserve cash.
“The layoffs cut across the organization, hitting human resources, cloud computing, advertising and a number of other business units, the people said. While the total number of reductions hasn’t been finalized – and not all of them will happen immediately – as many as 30,000 people could be affected, one of the people said.
The New York Times clarifies the initial reports by saying that Amazon is saying that it plans to immediately cut 14,000 corporate jobs, with sources saying that “another round of corporate cuts is expected in January, after the holiday shopping season.”
Beth Galetti, Amazon’s executive in charge of human resources, said in a memo to staff that the layoffs will allow the company “to get even stronger by further reducing bureaucracy, removing layers, and shifting resources to ensure we’re investing in our biggest bets and what matters most to our customers’ current and future needs.”
The Journal writes that “Amazon Chief Executive Andy Jassy has been on a yearslong campaign to cut expenses as the company ramped up spending on artificial intelligence, as it faced increased competition for its cloud computing business.”
The Seattle Times adds that the layoffs “would be the largest wave in the company’s history. Amazon previously had two series of terminations in late 2022 and early 2023 that ultimately resulted in 27,000 employees losing their jobs.
“Amazon has conducted layoffs since 2023, but it’s been in smaller cuts to targeted teams and divisions. The company laid off several hundred employees from its cloud computing division in July in a similar move to other cuts made in 2024.”
Business Insider notes, “Amazon doubled its workforce to 1.6 million from 2019 to 2021, but that number dipped to 1.55 million last year. Amazon has already cut at least 27,000 employees since late 2022.”
And from CNBC:
“The (30,000) figure represents a small percentage of Amazon’s 1.55 million total employees, but nearly 10% of the company’s roughly 350,000 corporate employees … Managers of impacted teams were asked to undergo training on Monday for how to communicate with staff following notifications that will start going out via email on Tuesday morning.”
CNBC goes on:
“Amazon CEO Andy Jassy is undertaking an initiative to reduce what he has described as an excess of bureaucracy at the company, including by reducing the number of managers. He installed an anonymous complaint line for identifying inefficiencies that has elicited some 1,500 responses and over 450 process changes, he said earlier this year.
“Jassy said in June that the increased use of artificial intelligence tools would likely lead to further job cuts, particularly through automating repetitive and routine tasks.”
More from Business Insider:
“A draft email that’s due to go out to impacted employees noted that Amazon is eliminating jobs ‘after a thorough review of our organization, our priorities, and what we need to focus on going forward.’ The draft document also described a severance package that includes full pay and benefits for the next 90 days.”
KC’s View:
I know it isn’t directly related, but it was only last week that there were multiple reports that “Amazon executives believe the company is on the cusp of its next big workplace shift: replacing more than half a million jobs with robots.”
This isn’t the robot revolution, but there seems to be little question that to some degree it is a response to the capabilities of AI in organizations like Amazon; Jassy has said as much, even if not specifically in regard to these massive layoffs.
I said it last week when commenting on the robotics story: “Jeff Bezos always has been seen as someone who preferred mechanization and algorithms to people and human judgement. People, in his reputed view, are a variable that are by their very nature in consistent and undependable. They also like raises, benefits, take sick time and lunch breaks, expect to be treated like actual people, and occasionally vote to unionize. Robots, AI and algorithms, on the other hand, don’t. Period. End of sentence.”
The thing I come back to – and I know Amazon execs have thought of this – is what is lost in terms of innovation and imagination with these kinds of moves. Maybe it will make Amazon more efficient, but will it be more effective?
Of course, it isn’t just Amazon. As the New York Times reports, “Amazon’s competitors have been turning to layoffs as well. Microsoft cut about 15,000 roles in the early summer. Target said last week that it would trim roughly 1,800 corporate jobs, and Meta laid off 600 people.”
Tough times in retail and tech. I’m guessing things will get worse before they get better.
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