Amazon will cut 10,000 jobs in its biggest ever retrenchment, as the company braces for a slowing economy and e-commerce pressures. According to people familiar with the matter, the layoffs could start as soon as this week. The biggest targets will likely be the company’s devices group, which is responsible for the Echo smart speakers and Alexa digital assistant, followed by the retail division and HR.
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The decision is coming from Amazon’s annual planning process, where the various teams have to decide where they can cut numbers. Chief Executive Officer Andy Jassy has vowed to streamline operations amid slowing sales growth and economic uncertainty. According to Amazon’s own forecasts, this year’s holiday shopping period will be the slowest in its history, which sent the company’s shares tumbling.
According to Amazon employees that have been with the company for years, and have asked to remain anonymous, have said that the cost-cutting measures seen at the company in recent months is the most extreme they’ve ever experienced. After booming in 2020 and 2021, the e-commerce giant has had to quickly adjust to very rapid slowdown in economic activity, which the company is in a prime position to notice early on.
At the end of September of this year, Amazon employed a total of 1.54 million people, with the vast majority of these people working in shipment- and fulfilment centres. These warehouses have already been severely affected with job cuts throughout the year. Amazon’s corporate workforce is concentrated in its Seattle headquarters, a growing Washington-area campus, as well as the San Francisco Bay Area, Los Angeles, Austin, Texas, and Boston.
Amazon’s Devices and Services group, which makes its consumer electronics and Alexa, is particularly vulnerable to downsizing following years of rapid expansion. The group’s voice-activated devices have had strong sales but haven’t evolved into a must-have shopping portal the way its inventors envisioned.
