Amazon announced the largest job cuts in company history. Here is why it will lay off 18,000 employees.
Amazon increases the number of upcoming layoffs. Last November, the e-commerce giant had already announced staff cuts in the order of 10,000, as the Italian Corriere della Sera recalls, but it recently corrected the number of laid-off employees, emphasizing the need to increase their share.
For the first time, Amazon will cut staff by around 18 thousand units, a small fraction of all its workers, but still an important cut that marks the company’s image first and foremost. The CEO Andy Jassay launched a message in this regard in a note to employees in which he explains how Amazon has resisted the uncertainties of recent years, not without difficulty and that these changes serve to maintain the structure of the company in the most solid way possible.
Amazon isn’t the first and won’t be the last of the big companies to lay off. The five tech giants, including Amazon, Meta and Apple, lost three trillion dollars in market value in 2022. The barrier to company growth has fallen on employees, who are now footing the bill for the contraction of profits.
Amazon cuts more employees than it had announced
The tech giants aren’t doing well, and the consequences of curbing their growth are weighing on employees. Amazon announced it would cut more jobs than anticipated last November. It is not the only company to make this decision, but certainly the cut of 18,000 employees marks the largest number of layoffs in the company’s history
In November, 10,000 layoffs had been announced, but on January 4, 2023, Amazon corrected the number, making the estimates much worse. In fact, approximately 18,000 layoffs have been declared. The cuts will primarily be for brick-and-mortar stores like Amazon Fresh and Amazon Go and its PXT organizations, which manage human resources.
Why are Amazon and other big tech companies laying off?
The pandemic has increased the earnings of companies like Amazon, so much so as to allow an increase in employees who, however, are no longer sustainable today. Between 2020 and 2022, the major Sillicon Valley companies continued to grow, as their growth increased the higher the number of jobs cut. According to data from Layoffs.fyi , 150,000 jobs were cut in 2022 by technology companies around the world.
Amazon does not deviate from the trend and the announcement of 18,000 layoffs confirms it. Chief Executive Officer Andy Jassy commented on the decision in a note to employees in which he writes:
Amazon has weathered uncertain and difficult economies in the past and we will continue to do so. These changes will help us pursue our long-term opportunities with a stronger cost structure.
Today’s cuts, Amazon points out, serve to keep the company active which saw its shares collapse by 49% in 2022 compared to 2021. The layoffs are therefore necessary to continue the work, says the CEO, but the cost of growth of the two years of the pandemic weighs on employees, without a workaround. The decision is common to all the big names in Silicon Valley technology affected by the increase in employees hired during the pandemic and the consequent stock market crash. There are already those who imagine a 2023 of changes for technology companies.
Original article published on Money.it Italy 2023-01-07 20:34:20. Original title: Perché Amazon licenzierà 18 mila dipendenti
