Amazon to lay off 30,000 employees, biggest job cut since 2022
New Delhi (The Uttam Hindu): E-commerce giant Amazon is preparing to implement large-scale layoffs to cut costs. The company plans to lay off approximately 30,000 employees. This move is being seen as a way to offset the increased hiring during the pandemic.
This number represents a small portion of Amazon's total workforce of 1.55 million, but represents nearly 10 percent of its corporate workforce (about 350,000). This would be Amazon's largest layoff since the end of 2022, when the company eliminated approximately 27,000 positions.
An Amazon spokesperson declined to comment. Over the past two years, the company has made limited job cuts across various departments, including devices, communications, and podcasting. This time, the layoffs could affect departments such as Human Resources, People Experience and Technology, Operations, Devices and Services, and Amazon Web Services (AWS). Managers of affected teams reportedly received training on Monday to help communicate with employees during the layoff process, which will begin Tuesday.
Amazon Chief Executive Officer Andy Jassy is leading a campaign to reduce bureaucracy and inefficiencies at the company. He launched an anonymous complaint line this year, which received nearly 1,500 responses and led to more than 450 process changes. Jassy has previously said that the increasing use of artificial intelligence (AI) tools could lead to further job cuts.
According to eMarketer analyst Sky Canaves, Amazon is working to reduce its workforce by increasing AI-based productivity within its corporate structure to offset its long-term AI investments.
According to sources, the Human Resources division is facing a potential reduction of approximately 15%. Employees were instructed to return to the office five days a week this year, but due to insufficient attrition, direct layoffs are now being implemented. Employees who do not return to the office are being asked to leave the company without severance pay.
Amazon's flagship unit, Amazon Web Services (AWS), reported sales of $30.9 billion in the second quarter, a 17.5 percent increase. However, this is lower than Microsoft's Azure (39 percent) and Google Cloud (32 percent). AWS sales are projected to grow by about 18 percent in the third quarter. AWS services were recently affected by a 15-hour internet outage, causing services like Snapchat and Venmo to crash.
The company has also restructured teams involved in diversity initiatives at its PXT unit, according to Reuters. Shares rose 1.2 percent to $226.97 on Monday. Amazon will release its third-quarter financial results on Thursday.