Amazon plans to lay off more than 18,000 corporate and tech workers.
“Several teams are impacted; however, the majority of role eliminations are in our Amazon Stores and PXT organizations,” Amazon CEO Andy Jassy wrote in a letter posted to Amazon’s corporate communications website. “[Amazon leadership] and I are deeply aware that these role eliminations are difficult for people, and we don’t take these decisions lightly or underestimate how much they might affect the lives of those who are impacted.”
Late last year, rumors suggested the e-commerce giant would cut 10,000 employees. This newly expanded number represents roughly 6 percent of the company’s overall workforce.
During the pandemic, as homebound customers purchased goods online and relied on cloud services for fun and productivity, Amazon doubled its workforce. However, rising fears of recession have led consumers to cut back on spending—and companies to curtail their use of cloud-based apps and services. Amazon’s growth has slowed, and its executives are looking to trim spending wherever they can.
Amazon’s severance packages will include a “separation payment,” transitional health insurance benefits, and job placement support. “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” Jassy added. “These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles.”
Amazon isn’t alone in cutting back after a few years of splurging on employees and projects. Earlier this week, for example, Salesforce announced it would cut 10 percent of its workers and shut down offices. “As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that,” Salesforce CEO Marc Benioff wrote in an open letter to employees.
Other big names in tech—including Meta, Uber, Amazon, Cisco, and Twitter—have also collectively laid off many thousands of workers over the past few months. However, these companies all have ambitious roadmaps for the future; at some point, they’ll need to resume hiring, especially for highly specialized roles.