Amazon to lay off 18,000 workers in largest tech company job cut
Amazon.com Inc., one of the largest technology companies in the world with presence in ecommerce, advertising, video streaming and cloud computing, has announced that it will be laying off 18,000 workers as the company copes with the economic downturn in the future, The Wall Street Journal (WSJ) reported.
Technology companies in the U.S. began laying off people as early as June last year, when Tesla began reducing its staff strength as CEO Elon Musk had a "super bad feeling" about the economy. As the year drew to a close, software-focused companies also announced job cuts, with Meta leading the list with as many as 11,000 employees facing the axe.
Around the same time, Amazon announced that it would be laying off 10,000 employees, but as we entered the new year, the number has ballooned by another 8,000 as more employees have been added to the list of job cuts that will happen over the coming weeks.
Amazon's dream run comes to an end
While the global economy came to a grinding halt due to the COVID-19 pandemic, Amazon was one of the few companies that saw record growth as people turned to online modes of shopping and entertainment. During the pandemic months, Amazon's needs for logistics nearly doubled, and the company added hundreds of thousands of workers to meet the unprecedented demand.
However, as life returned to normal, following the decrease in COVID-19 cases, customers went back to shopping in stores and Amazon was forced to look for ways to cut down its costs. Apart from a hiring freeze, the company also shut down some of its physical stores and unprofitable businesses. With the demand showing no signs of growth in the uncertain economic climate, Amazon decided to let employees go, a number that was nearly doubled in the past couple of months.
"Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so," said CEO Andy Jassy in a blog post while also adding that the majority of the job cuts are in the retail and recruiting side of its business focused in its corporate ranks.
The highest in absolute numbers but a small percentage
Amazon's layoffs are definitely the highest in absolute numbers for the technology industry. Yet, they account for only five percent of that element of its workforce and 1.2 percent of the overall total of its workforce, the WSJ said in its report.
In contrast, other tech companies have laid off a larger share of their total employees during this period. Meta's job cuts announced last year would account for a reduction of its workforce by 13 percent, while Salesforce added earlier this week that it was also reducing its employee count by 10 percent.
While companies like Lyft, HP and many others also reported layoffs, nothing can match the over 50 percent layoffs that Elon Musk effected at Twitter after taking over the social media company. In comparison, Amazon still looks to be in the safe zone, even though Musk claims that Twitter isn't going to be bankrupt anytime soon.
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