Amazon com Inc’s (AMZN.O) job cuts will now extend to more than 18,000 jobs as part of a headcount reduction it previously announced, Chief Executive Andy Jassy said in a public staff note on Wednesday.
The layoff decisions, which Amazon will announce starting Jan. 18, will greatly impact the firm’s e-commerce and human resources organizations, he said. The layoffs consist of 6% of Amazon’s almost 300,000-person corporate workforce and indicate a swift turn for a retailer that recently doubled its base pay ceiling to compete more strongly for talent.
Amazon has over 1.5 million employees including warehouse staff, making it America’s second-biggest private employer behind Walmart Inc (WMT.N). Its stock rose 1.8% at $86.71 in premarket trading on Thursday.
A spokesperson for London-based trade union GMB said it was cognizant of the layoffs, but that its members will not be affected by the plans. Members belonging to the union who work at the Amazon warehouse in Coventry, central England, are preparing to stage a walkout on Jan. 25 over a pay row with the e-commerce giant.
Laurent Degoussee of the SUD union in France also said the plans would not have an impact on the company’s Amazon Logistique France unit. Douglas Harper, a spokesperson for Spain’s biggest trade union CCOO, condemned what he said was an absolute lack of information from the company.
“We don’t know how this will affect us in Spain,” Harper told Reuters. “We can assume that this is the first step preceding layoffs in the rest of operations, not just the corporate workforce, but we don’t have any official data.”
Jassy said in the note that annual planning “has been more difficult given the uncertain economy and that we’ve hired rapidly over the last several years”.
Amazon has prepared for likely slower growth as surging inflation encouraged consumers and businesses to curtail spending, and its share price has halved in 2022.
The company started laying off staff in November from its devices division, with a source telling Reuters at the time it was aiming to cut around 10,000 jobs. The tech industry let go more than 150,000 workers last year, according to tracking site Layoffs.fyi, a number that’s continuing to increase.
Salesforce Inc (CRM.N) said Wednesday it planned to terminate about 10% of employees, which amounted to nearly 8,000 as of Oct. 31.
Buy Bitcoin NowThe reversal of Amazon’s fortunes has been grim. It shifted from a business considered crucial during the pandemic for delivering goods to locked-down homes, to a company that overbuilt for demand.
Its layoffs now exceed the 11,000 cuts communicated in 2022 by Facebook parent Meta Platforms Inc (META.O).
Jassy’s note came after a report in the Wall Street Journal that the cuts would be more than 17,000 jobs. He said Amazon decided to announce the news before informing affected staff because of a leak.
Amazon still must file certain legal notices about mass layoffs, and it intends to pay severance.
Jassy said:
“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.”
