Amazon has announced its intention to lay off 14,000 employees as part of a broader initiative expected to impact tens of thousands of roles.
The Seattle-based retail leader is facing challenges in reversing the extensive hiring surge prompted by the pandemic, working on cost reduction and streamlining its vast operations. This summer, the company’s CEO cautioned white-collar employees about the potential for artificial intelligence to take over their jobs.
Beth Galetti, Amazon’s senior vice president, communicated in a memo to employees on Tuesday: “The reductions we are announcing today…are part of our ongoing efforts to further diminish bureaucracy, eliminate layers, and reallocate resources to prioritize investments in our key initiatives and better meet our customers’ current and future needs.”
On Monday, Reuters and The Wall Street Journal reported that Amazon is poised to eliminate up to 30,000 corporate positions, according to anonymous sources familiar with the situation, as it attempts to unwind an unprecedented hiring spree triggered by a temporary surge in online shopping during the height of the COVID-19 pandemic. CNBC indicates this could mark the largest layoff event in the company’s history.
These layoffs constitute a minor fraction of Amazon’s total 1.55 million global employees, but they significantly impact the company’s roughly 350,000 corporate workforce.
On Monday, Amazon refrained from commenting on the extensive layoffs until Galetti revealed the 14,000 job cuts the following day. He also informed employees that the company will strive to pinpoint “further areas where we can streamline structures, enhance accountability, and achieve efficiency improvements” throughout 2026.
“Some may question why roles would be reduced if the company is performing well,” Galetti expressed. “Across our divisions, we consistently provide excellent customer experiences, innovate swiftly, and deliver outstanding business results. We must acknowledge that the world is evolving rapidly.”
“This wave of AI is the most groundbreaking technology since the Internet, allowing companies to innovate more rapidly than ever throughout existing and completely new market segments.”
Following the initial reports of layoffs, Amazon’s shares, which are set to announce quarterly results later this week, increased by 1.2% on Monday.
Other tech giants have similarly rolled back extensive hiring campaigns initiated during the pandemic. Microsoft; Meta’s parent company, which includes WhatsApp, Instagram, and Facebook; as well as Google’s parent company, Alphabet, have collectively laid off tens of thousands of workers in recent years.
Back in June, Amazon CEO Andy Jassy informed employees that generative AI technologies, such as autonomous AI agents and chatbots, would reduce staffing requirements in certain roles.
“While it’s challenging to predict the exact impact over time, we anticipate this will lead to workforce reductions in the upcoming years,” Jassy stated in a memo to staff.
In recent times, Amazon has implemented job cuts across various divisions, including devices, communications, podcasting, and more.
This week’s layoffs are projected to influence a broad spectrum of departments within Amazon, including human resources (referred to as people experience), technology, devices and services, and operations, among others. Luck reported that as much as 15% of Amazon’s human resources sector could be affected, according to sources familiar with the company’s plans.
According to Reuters, citing unnamed insiders, managers from impacted teams were informed on Monday that they would receive notifications via email starting the next morning and would be required to undergo training on how to communicate changes with their teams.
Mr. Jassy has previously stated that the company aims to minimize what he refers to as excessive bureaucracy within Amazon, including reducing managerial positions. He also introduced an anonymous complaint line for addressing inefficiencies, which has generated roughly 1,500 responses and led to over 450 process modifications.
Report contributed by Reuters
Source: www.theguardian.com
