In brief: It's not just Amazon warehouse workers who are fearing for their jobs. The tech giant is planning to lay off up to 30,000 corporate staff – the largest number of cuts in its history – as the company continues to undo the massive overhiring spree undertaken during the pandemic years.
Update: Amazon has now said it will reduce its corporate workforce by about 14,000 people, with more cuts to follow next year. It has partly blamed the move on AI adoption, which some say has become a scapegoat for companies making layoffs.
Amazon has 1.55 million employees worldwide, so while the layoffs only represent a small percentage of its total staff, it's still around 10% of its 350,000 corporate workers.
The layoffs were reported by Reuters and The Wall Street Journal, citing unnamed sources familiar with the matter.
Virtually every company hired extra staff to cope with the surge in demand when Covid shut down most of the world. Amazon, the second-largest employer in the United States, saw a huge boom in business as people stayed indoors and bought products to alleviate the boredom. The firm's headcount reportedly tripled between 2017 and 2022.
But online shopping's explosion in popularity started to wane once life returned to normal, leaving employers with more workers than required.
Amazon has already let go of around 27,000 people due to pandemic-era overhiring during the last two years, more than any other company. The latest cuts are said to affect multiple corporate divisions, including human resources, operations, devices and services, and Amazon Web Services. HR is believed to be one of the divisions impacted the most, with up to 15% of roles affected.
Amazon team managers have been asked to undergo training for how to communicate the job losses to those affected. The termination emails will reportedly start going out this morning.
While the focus of the reports is on Amazon's overhiring, it's worth remembering that in June, CEO Andy Jassy told employees that AI would mean fewer people being required for certain jobs. He added that Amazon expected to reduce its corporate workforce due to the "efficiency gains" introduced by AI.
Jassy also wants to simplify Amazon's corporate structure and remove layers of bureaucracy. He introduced an anonymous complaint line for claims of inefficiencies that has seen 1,500 responses and more than 450 process changes.
According to leaked documents last week, Amazon plans to replace 600,000 US warehouse workers with robots by 2032. It also aims to automate 75% of all operations at the company, thereby eliminating 160,000 positions that would have otherwise been required by 2027. Amazon put out a press release the next day stating that robots aren't taking human jobs – while also revealing two new robots designed to take human jobs.
Amazon to lay off 30,000 corporate workers after pandemic overhiring
