Amazon layoffs: Tech giant to cut 14,000 jobs; another round coming later?

Amazon said on Tuesday that it would cut its corporate workforce by about 14,000 people, partly driven by its push for integrating artificial intelligence (AI) into its ecosystem.

However, this is likely to be followed by another round of corporate cuts after the holiday shopping season in January—which will reportedly target senior-level staff, as per an Economic Times article, citing a New York Times report, which quoted two people familiar with the development.

"The reductions we’re sharing today are a continuation of (CEO Andy Jassy's) work to get even stronger by further reducing bureaucracy, removing layers, and shifting resources to ensure we’re investing in our biggest bets and what matters most to our customers’ current and future needs," read an Amazon note sent to its employees on Tuesday.

The tech giant has also reportedly asked department leaders, including those in human resources, to lower headcount-related expenses by 10 to 15 per cent. Even those in highly-senior positions, like directors, are likely to be affected harder than in the previous layoffs.

This follows an earlier Reuters report that Amazon planned to cut as many as 30,000 jobs from Tuesday onwards, amid its AI push and restructuring to compensate for over-hiring during the pandemic.

"We expect to continue hiring in key strategic areas while also finding additional places we can remove layers, increase ownership, and realise efficiency gains," Beth Galetti, senior vice president of Amazon's People Experience and Technology, wrote in the note.

Amazon had about 1.56 million full-time and part-time employees by the end of 2024, with a corporate workforce of roughly 350,000 employees. If the tech giant ultimately cuts 30,000 jobs by January 2026, it would mean a reduction of nearly 10 per cent of its workforce.

What netizens said about the 30,000 layoffs

"The great reset is coming," an X user wrote, comparing the situation to the Great Depression of 1929.

"High investment costs in artificial intelligence and data centers are reducing margins. Investors fear that the AI momentum won’t offset those costs in the short term," another X user mused.

"Is amazon pushing big new tech anymore? Seems like they staffed up for AWS and other things, I wonder if the company is moving towards the "maintenance" stage where they try to milk their existing products as long as possible," a Redditor questioned.

"How much longer is this excuse going to hold water?" another Redditor wrote, about Amazon saying it was compensating for overhiring during the peak demand of the pandemic.

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