Amazon CEO Andy Jassy wrote in a blog post that the company is planning to lay off 18,000 employees. This represents the highest number of job cuts at a technology company.
The company already announced its plan to cut its workforce in November last year. But during that time, the company is expected to lay off only 10,000 workers.
Layoffs Will Affect Human Resources and Retail Operations
According to CNET, several divisions will be affected by the job cuts. But the majority of those who will be affected are in the company's human resources and retail operations.
Meanwhile, NPR reported that the hourly warehouse workers will not be affected by the layoffs.
Jassy said in the blog post that Amazon will notify affected employees by January 18. The CEO also wrote that the job cuts were due to uncertain economic conditions as well as the company's rapid hiring in the past years.
The layoffs represent roughly 5 percent of the corporate rank's workforce. Meanwhile, it is 1.2 percent of the company's overall tally of 1.5 million employees as of September.
Amazon benefitted from the pandemic as customers turned to online shopping. The company's profit increased with the boom of online shopping due to lockdowns.
In order to keep up with demand from eager customers, Amazon doubled its logistics network. Similarly, it added hundreds of thousands of employees.
In 2021, the company was able to double the number of its employees from just under 800,000 at the end of 2019 to more than 1.6 million.
However, as the pandemic ease out, the demand for online shopping started to wane. Customers started moving back to shopping in stores.
With this, Amazon initiated a broad cost-cutting review in order to reduce the number of employees in units that were unprofitable, The Wall Street Journal reported.
The company then made targeted job cuts to bring down costs. Moreover, it shut down physical stores and other business units such as Amazon Care.
Later on, the company announced a companywide hiring freeze. Eventually, it decided to let employees go.
Read Also: Amazon Confrims Layoffs in Devices and Services Organizartion Has Started
Other Tech Companies Also Cut Their Workforce Amid the Economic Downturn
Amazon is not the only tech giant that initiated job cuts. Many tech companies have laid off employees as economic conditions became uncertain.
Just recently, business software giant Salesforce also announced its own round of layoffs. The company eliminated 10% of its workforce or about 8,000 employees.
According to Salesforce Co-CEO Mark Benioff, the company hired too many employees during the pandemic and there is a need to cut costs because of a pullback in corporate spending.
In a note to staff, Benioff said that because the company's revenue accelerated through the pandemic, it hired many people which led to the current economic downturn.
In recent months, Twitter, Microsoft, and Google have also let go of thousands of workers.
Meanwhile, Jassy acknowledged that while the company went into a hiring spree, it intends to help cushion the impact of the job cuts for the laid-off workers.
According to him, the company is working to support those who are affected by the layoffs. The company is providing packages that include a separation payment, transitional health insurance benefits, and external job placement support.
Related Article: Amazon Plans To Cut Thousands Of Employees In Sweeping Layoffs
