Citing the "uncertain economy" and "rapid hirings" over the past few years, Amazon's CEO Andy Jassy on Wednesday said in a statement that over 18,000 employees will be laid off. "This year's review has been more difficult given the uncertain economy and that we've hired rapidly over the last several years," Jassy wrote in a message to Amazon employees that was also shared publicly.
In November 2022, Amazon had announced that it would lay off about 10,000 employees in corporate and technology jobs, nearly 1% of its global workforce, according to The New York Times.
Jassy said that workers facing job cuts will be informed from January 18, 2023. Jassy said that the communication for the layoffs had to be made public because the information had been leaked externally.
Here's what we know about the latest job cuts at Amazon:
Why has Amazon announced layoffs?
After the fresh review, over 18,000 job roles are likely to be eliminated at Amazon. This is bigger than its previous downsizing in November 2022.
"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," Jassy said on Wednesday.
The first major job cuts happened at Amazon in November 2022 when 10,000 jobs were slashed down, The New York Times report said. Most of these jobs were from its tech and corporate sectors. Amazon founder Jeff Bezos had warned that the US was headed to an economic recession and that corporations should brace for the crisis ahead. "My advice to people whether they're small business owners is take some risk off the table. If you were going to make a purchase, maybe slow down that purchase a little bit. Keep some dry powder on hand and wait a bit," he had said in an interview with CNN.
What did Amazon CEO say?
Jassy in his statement said while the standard procedure is to communicate the decision only after informing the affected employees, the management made the announcement after the news was "leaked externally".
"We typically wait to communicate about these outcomes until we can speak with the people who are directly impacted. However, because one of our teammates leaked this information externally, we decided it was better to share this news earlier so you can hear the details directly from me," Jassy said.
"Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so. These changes will help us pursue our long-term opportunities with a stronger cost structure," he further added.
He said the company will work to be "inventive, resourceful, and scrappy" during the time when they're not "hiring expansively". "Companies that last a long time go through different phases. They're not in heavy people expansion mode every year," he said.
Who will be impacted most?
Amazon has 1.5 million workers across the world, according to a report on BBC. Most of the layoffs will be done in Amazon Stores and People, Experience, and Technology (PXT) organizations. Reuters reported that in 2022, over 1,50,000 workers in the tech sector lost jobs, including Facebook-parent Meta Platforms Inc, Google, Apple and Twitter.
Mass layoffs happened at Twitter last year after Elon Musk took over as its new CEO. Employees were fired from the public policy and media and entertainment teams, according to reports. In November, almost half of Twitter's workforce faced layoffs.