As it prepares for slower growth and a potential recession, Amazon.com Inc. plans to lay off 10,000 workers, the most ever at the e-commerce platform.
People with knowledge of the situation say that the layoffs, which could start as early as this week, will probably target Amazon’s devices group, which is in charge of the Alexa digital assistant and Echo smart speakers, as well as its retail divisions and human resources.
According to the sources, teams are deciding where to lay off staff as part of the company’s yearly planning process, who asked to remain anonymous to discuss a private topic.
With sales growth slowing and the economy uncertain, CEO Andy Jassy has vowed to streamline operations. The Seattle-based company’s prediction that the holiday shopping season would be the slowest in its history last month alarmed Wall Street and caused the shares to crash.
According to some long-time Amazon employees, the cost-cutting in the last several months has been the most severe they have ever seen.
In New York, the shares were down around 1.4%. The upcoming lay off were previously revealed by the New York Times.
The biggest online retailer in the world has spent a significant portion of this year adjusting to a steep slowdown in e-commerce growth as consumers returned to their pre-pandemic routines. Before extending the employment ban to the company’s business groups, Amazon postponed opening new warehouses and stopped hiring in its retail division. Jassy has recently intensified his search for cost reductions among experimental and unsuccessful enterprises.
The corporation disbanded teams working on various initiatives, including a delivery robot, a kids’ video conferencing device, and a telemedicine service.
At the end of September, Amazon employed 1.54 million individuals. Most of them were hourly workers who packed and shipped goods in warehouses or worked in Whole Foods Market and other retail establishments. The Seattle headquarters of Amazon, a developing campus in the Washington, D.C., region, as well as the San Francisco Bay Area, Los Angeles, Austin, Texas, and Boston, are where most of the company’s employees are.
After years of rapid expansion, Amazon’s Devices and Services division, which produces Alexa and consumer goods, is particularly susceptible to shrinking. Although the voice-activated devices of the group have had significant sales, they have yet to develop into a must-have shopping gateway as their creators had hoped.
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To withstand the dotcom bust in the early 2000s, Amazon sacked thousands of workers. Since then, the business has experienced sporadic moments of primarily self-imposed austerity to combat organizational fat, occasionally pausing hiring for months on significant teams.