Amazon to lay off 18,000 employees after whooping earnings during the pandemic citing the reason being an “uncertain future economy”.
Amazon has over 1.5 million employees, making it the second largest private employer in the US, after Walmart. While Amazon earned heavily during the COVID-19 pandemic, the company’s Chief Executive Andy Jassy said in a public staff note that annual planning “has been more difficult given the uncertain economy and that we’ve hired rapidly over the last several years.”
The mega-retailer stated it had ‘hired rapidly’ over the past few years and was prompted by an ‘uncertain economy.”
The 18,000 layoffs include both the recent ones and the ones previously announced in November. They will mostly impact the company’s e-commerce services such as Amazon Fresh and Amazon Go, as well as the human resources organizations.
This move is the biggest cuts in the company’s history, started in November last year, are considered the biggest in the company since it launched in 1994.
While powerful economies battled with recession and high inflation in 2022, several tech companies toiled to sustain their businesses, Amazon by contrast earned heavily with massive surges in revenues they achieved during the pandemic.
The social media giant Meta, which runs Facebook, Instagram, and Whatsapp, announced in November last year that it was laying off 13% of its workforce.
However, the Reuters news agency pointed out that Amazon’s job cuts surpassed that of other tech giants, Meta included.
Analysts see the cuts as the end of a so-called tech boom that has reigned over the last decade.
This is a shrewd move by Benioff to preserve margins in an uncertain backdrop as the company obviously overbuilt out its organization over the past few years along with the rest of the tech sector with a slowdown now on the horizon, Wedbush analyst Dan Ives wrote.
Salesforce also said Wednesday that it will be closing some of its offices, but didn’t include locations. The company’s 61-story headquarters is a paramount feature of the San Francisco skyline and a mark of tech’s importance to the city since its completion in 2018.
