Amazon sacks 18,000 employees citing economic uncertainty

Amazon CEO Andy Jassy said the company is working to support those who are affected by the layoff.

Washington, Jan 05: Owing to economic uncertainty, Amazon has announced that it will cut more than 18,000 jobs from its workforce.

"This year's review has been more difficult given the uncertain economy and that we've hired rapidly over the last several years. In November, we communicated the hard decision to eliminate a number of positions across our Devices and Books businesses, and also announced a voluntary reduction offer for some employees in our People, Experience, and Technology (PXT) organization. I also shared that we weren't done with our annual planning process and that I expected there would be more role reductions in early 2023.

Today, I wanted to share the outcome of these further reviews, which is the difficult decision to eliminate additional roles. Between the reductions we made in November and the ones we're sharing today, we plan to eliminate just over 18,000 roles. Several teams are impacted; however, the majority of role eliminations are in our Amazon Stores and PXT organizations," Amazon CEO Andy Jassy said in a statement.

Jassy claims that they are "deeply aware that these role eliminations are difficult for people" and the company do not take these "these decisions lightly or underestimate how much they might affect the lives of those who are impacted." However, the company is working to support those who are affected and are providing packages that include a separation payment, transitional health insurance benefits, and external job placement support.

The employees, who are being shown the door, have not been communicated about it yet and the decision to formally announce about the layoff was made after it 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. We intend on communicating with impacted employees (or where applicable in Europe, with employee representative bodies) starting on January 18," the CEO added.

The changes will help Amazon to pursue its 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. Companies that last a long time go through different phases. They're not in heavy people expansion mode every year. We often talk about our leadership principle Invent and Simplify in the context of creating new products and features. There will continue to be plenty of this across all of the businesses we're pursuing. But, we sometimes overlook the importance of the critical invention, problem-solving, and simplification that go into figuring out what matters most to customers (and the business), adjusting where we spend our resources and time, and finding a way to do more for customers at a lower cost (passing on savings to customers in the process). Both of these types of Invent and Simplify really matter," he claimed.

The group doubled its staff during 2020 and 2022 to meet an explosion in demand for deliveries. Apart from seasonal workers recruited during periods of increased activity, particularly during the holiday season, the company, at the end of September 2022, had 1.54 million employees worldwide.