Amazon says it plans to lay off more than 18,000 workers as the global economic outlook continues to deteriorate.
Several teams, including HR and Amazon stores, will be affected, according to a memo shared with employees by CEO Andy Jassy.
“Long-lived companies go through different stages. They’re not in heavy-people expansion mode every year,” he said.
Jassy said in November that job cuts at e-commerce giant Amazon would continue until early 2023. Multiple outlets reported in the fall that Amazon plans to cut about 10,000 jobs.
Amazon and other tech companies have significantly increased hiring over the past few years as the pandemic shifted consumer habits towards e-commerce.
Now, many of these seemingly unruly tech companies are experiencing whiplash and laying off thousands of workers as people return to their pre-pandemic habits and macroeconomic conditions worsen.
In a memo, Jassy said Amazon’s management recently met to decide how to streamline the company, prioritizing “what matters most to our customers and the long-term health of our business.” He said he had decided how
“This year’s review has been more difficult given the uncertain economy and rapid adoption over the past few years,” he added.
The layoffs will help Amazon pursue long-term opportunities with a stronger cost structure, Jassy said. However, he called the layoffs a “difficult decision” and said, “We are deeply aware that the elimination of these roles is difficult for people, and we do not want these decisions to be taken lightly or impact the lives of those affected. I don’t underestimate how much impact it will have.”
He added that the company will begin notifying affected staff from January 18.
Amazon’s business was initially booming during the pandemic as consumers relied on online shopping for nearly everything.
But this year, the company is facing a return to in-person shopping and a spike in inflation, causing a sharp drop in consumer demand.
In October, Amazon let Wall Street down with its holiday predictions, which fell sharply short of analysts’ expectations. The company’s stock has fallen about 50% last year.
Like Jassy, many other tech founders and CEOs have admitted to failing to measure pandemic demand accurately.
Facebook’s parent company, Meta, recently announced an 11,000 job cut, the largest in the company’s history. Twitter also announced extensive job cuts after Elon Musk bought the company for his $44 billion.
Salesforce announced this week that it will cut 10% of its staff.