Amazon has raised the number of roles it plans to eliminate from its corporate workforce to over 18,000 as the e-commerce giant looks to rein in costs amid a weakening global economy.
In a blog post published yesterday, Chief Executive Andy Jassy said the majority of the cuts would largely impact the company’s e-commerce and human resources units.
The figure is substantially higher than the 10,000 job losses that press reports quoted towards the end of last year.
The cuts amount to around 6% of Amazon’s roughly 300,000-person corporate workforce. It also has millions of warehouse and delivery staff.
Jassy cited the “uncertain economy” for the cuts, saying it had “hired rapidly over several years.”
He added: “We don’t take these decisions lightly or underestimate how much they might affect the lives of those who are impacted.”
Jassy revealed that the announcement had been brought forward due to one of the company’s employees leaking the cuts externally.
“Companies that last a long time go through different phases. They’re not in heavy people expansion mode every year,” he stated.
“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.”
The move mirrors belt-tightening by other Big Tech groups in recent months as large companies dial back rapid headcount growth seen during the pandemic.
After enjoying bumper growth during the Covid crisis, Amazon has recently faced rising costs and more subdued customer demand as people return to shopping in physical stores. A combination of a downturn in advertising revenues due to businesses seeking to save cash, alongside consumers spending less as the cost of living crisis bites, is also hitting tech firms hard.
Meanwhile, it was announced yesterday that the first-ever strike by UK workers at Amazon will be held later this month.
Members of the GMB union based at the company’s Coventry warehouse will walk out on 25 January after voting in favour of taking industrial action. Further strike dates are expected to be announced in the coming weeks.
GMB senior organiser Amanda Gearing said the workers at the fulfilment centre voted to walk out in anger over the company’s 50 pence per hour pay offer.
Amazon said it appreciated the work its teams carried out, and they were offered competitive pay and benefits.
The union organiser said: “They’ve [the workers] shown they’re willing to put themselves on the line to fight for what’s right. But people working for one of the most valuable companies in the world shouldn’t have to threaten strike action just to win a wage they can live on.”
She urged Amazon UK bosses to give workers “a proper pay rise and avoid industrial action”.
Amazon stated that the strike would have “zero impact” on customers as the Coventry site was not a fulfilment centre that directly services online orders – providing stock to its UK centres instead.
NAM Implications:
- Big company, big workforce.
- Big fall in share price…
- …therefore big cuts in workforce come with the territory.
- Essential to keep in mind that if Amazon are experiencing difficulties…
- …what chance the rest of us?
- i.e. Realism counts, going forward…
