Layoffs Reach Amazon After Years of Unabashed Growth

Adding to a long list of tech layoffs, Amazon plans to cut approximately 10,000 people from its workforce starting this week. According to The New York Times, the layoffs will mostly affect the company's loss-making devices division, its retail business as well as human resources. Just last month, Amazon announced that it's hiring 150,000 people for the holiday season, but those are mostly hourly delivery/warehouse workers as opposed to corporate employees who will be affected by the latest layoffs.

While many companies were forced to cut jobs in face of the Covid-19 pandemic, Amazon went the opposite direction. In 2020 alone, the e-commerce behemoth created 500,000 new jobs, adding another 300,000 to its global workforce in 2021. As the economic outlook soured and cost pressures began to mount in 2022, the company's decade-long hiring spree came to an abrupt end, however.

With hiring freezes and layoffs spreading like wildfire in the wider tech industry, Amazon already reduced its global workforce in the first six months of the year. At the end of June, Amazon's global workforce, including part-time employees but not including contractors and temps was 1.52 million strong, 85,000 shy of the total at the end of 2021. By the end of September, that number had climbed back to 1.54 million and it will probably continue to climb through the rest of year as holiday season hires will outnumber layoffs by a significant margin.

Amazon's latest results came in below Wall Street's expectations and its outlook for the important holiday season was dimmed by the grim economic outlook. “We’re encouraged by the steady progress we’re making on lowering costs in our stores fulfillment network, and have a set of initiatives that we’re methodically working through that we believe will yield a stronger cost structure for the business moving forward," the company's CEO Andy Jassy said last month, hinting at cost-cutting measures.