The online retail giant cited “the uncertain economy” and the fact that it had “hired rapidly” during the pandemic in its announcement on Wednesday that it would be eliminating more than 18,000 positions from its workforce.
In a statement to his employees, CEO Andy Jassy said, “We plan to eliminate just over 18,000 roles between the reductions we made in November and the ones we’re sharing today.” In November, the company announced 10,000 layoffs.
According to Jassy, the leadership of the company was “deeply aware that these role cuts are difficult for people, and we don’t take these decisions lightly.”
He stated, “We are working to support those who are affected and are providing packages that include a separation payment, transitional health insurance benefits, and external job placement support.” He added, “We are working to support those who are affected.”
Jassy stated that some of the layoffs would take place in Europe and that employees affected would be informed beginning on January 18.
He stated, “because one of our teammates leaked this information externally,” that the sudden announcement was being made. Given the uncertain economy and the rapid hiring over the past few years, this year’s review has been more challenging, Jassy stated.
Tech downsizing
Among the recent workforce reductions that have had an effect on the US tech sector, Amazon’s plan to cut jobs is the largest.
It is also the largest ever for the Seattle-based business.
In the third quarter, Amazon’s net profit decreased by 9% year over year. In addition, Amazon predicted in November that the company would make an operating profit of between zero and four billion dollars for the final quarter, compared to 3.5 billion dollars for the same period in 2021, a loss of 3.5 billion dollars for the same period in 2021.
On February 1, the organization is scheduled to release its annual results.
Major platforms in the technology sector that operate on an advertising-based business model are experiencing budget reductions from advertisers, who are cutting costs in response to rising interest rates and inflation.
Facebook’s parent company, Meta, made the news in November that it would be cutting 11,000 jobs or about 13 percent of its workforce. Snapchat laid off approximately 1,200 workers at the end of August or about 20% of the company’s workforce.
Elon Musk, a billionaire, bought Twitter in October. Immediately after, about half of the social media platform’s 7,500 employees were let go.
Additionally, the IT company Salesforce, which specializes in management solutions and cloud technology, announced on Wednesday that it would be cutting roughly 8,000 jobs or 10% of its workforce.
“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” he added. In fact, the retailer had increased its workforce worldwide by a factor of two between the beginning of 2020 and the beginning of 2022 in response to the soaring demand for deliveries caused by the pandemic.
At the end of September, the company had 1.54 million people working for it worldwide. This does not include seasonal workers who are hired during times of increased activity, like the holiday season.
Source: AFP
