Layoffs in e-commerce - statistics & facts
The layoffs wave hitting the tech industry has not spared e-commerce players. Economic recession alongside unprecedented inflation in 2022 impacted consumer demand and the capital market so heavily that e-commerce companies were forced to rethink their business strategies and decided to trim down their workforces. The mix of all these factors led to a stagflation scenario that is likely to persist in 2023.
Higher automation and widespread use of artificial intelligence (AI) will affect the job market of white-collar workers, too. In the United States, generative AI could increase automation of customer service, transportation services, and food services – all relevant fields for e-commerce professionals. Customer support is going to be one of the most affected sectors, as its work demand is expected to decline by 13 percent between 2023 and 2030. Prospects for the impact of generative AI indicate that higher automation on multiple levels is going to shape the future e-commerce job market.
A perfect storm
The full reopening of brick-and-mortar stores and food services after the COVID-19 pandemic contributed to a milder growth in e-commerce revenue. As a result, a significant share of workers initially hired to cope with the unprecedented e-commerce growth has been dismissed. In the first months of 2023, the e-commerce behemoth Amazon cut off 17,000 jobs. Competitor eBay also downsized its headcount due to its stagnating retail business activity registered over the last two years. Besides big marketplaces, online food delivery startups that emerged during the last two-year boom scaled back their activities, as increased fuel prices and lower consumer demand took a toll on their profits. This is the case of the U.S. company GoPuff, which let go 2,300 employees only between January and October 2022. In Europe, Flink holds the record for the biggest layoff, with 8,100 employees losing their jobs between April and May 2023.Biggest threats for e-commerce jobs
Online retail giants seem to follow the more general downturn trend of software and tech businesses headquartered in Europe and North America, mainly because the adverse economic scenario induces investors to reduce funding in e-commerce companies and the entire retail technology sector. E-commerce job losses primarily involve logistics workers. In the United Kingdom alone, Amazon announced the closure of three big distribution centers in 2023, while Walmart let go of 2,000 employees working at warehouses dedicated to e-commerce operations.Higher automation and widespread use of artificial intelligence (AI) will affect the job market of white-collar workers, too. In the United States, generative AI could increase automation of customer service, transportation services, and food services – all relevant fields for e-commerce professionals. Customer support is going to be one of the most affected sectors, as its work demand is expected to decline by 13 percent between 2023 and 2030. Prospects for the impact of generative AI indicate that higher automation on multiple levels is going to shape the future e-commerce job market.
