Amazon is planning to eliminate 9,000 jobs over the coming weeks, mostly in its AWS, People Experience and Technology (PXT), Advertising and Twitch businesses. The downsizing is on top of the 18,000 layoffs announced in January 2023, though Amazon plans to continue hiring in areas where the company is prioritizing the allocation of resources.
The cuts are being made as Amazon streamlines its costs and headcount due to “the uncertain economy in which we reside, and the uncertainty that exists in the near future,” according to CEO Andy Jassy in a blog post. “The overriding tenet of our annual planning this year was to be leaner while doing so in a way that enables us to still invest robustly in the key long-term customer experiences that we believe can meaningfully improve customers’ lives and Amazon as a whole,” he wrote.
The reason for a separate second round of cuts (rather than announcing them all at once) is that not all of Amazon’s teams were done with their analyses in late fall 2022, and the retailer wanted to give them time to complete their investigations before taking the necessary actions. Additionally, the affected teams have not yet decided which roles will be eliminated, though that process is expected to be complete by mid- to late April. All affected employees will receive packages that include a separation payment, transitional health insurance benefits and external job placement support.
Despite the job cuts and concerns about the broader economy, Jassy wrote that he remains “very optimistic about the future and the myriad of opportunities we have, both in our largest businesses, stores and AWS, and our newer customer experiences and businesses in which we’re investing.”
Amazon also temporarily paused corporate hiring in November 2022 as it prepared for a potential economic downturn, and reached an agreement with lenders to take out an $8 billion loan in January 2023. However, the ecommerce giant is far from alone among major tech companies looking to right-size their operations:
- Microsoft will lay off 10,000 people, or approximately 5% of its total employees, by April;
- Meta announced it would cut 10,000 jobs and close 5,000 open postings in March, on top of the 11,000 layoffs started in November 2022; and
- Alphabet, Google’s parent company, eliminated 12,000 jobs in January as it prepared to “sharpen focus” on its AI offerings.