July 15, 2024


The Techno Universe

Amazon starts cutting thousands of workers

Amazon starts cutting thousands of workers


In a dramatic turnaround from its constant expansion of the past decade, Amazon began laying off corporate employees Tuesday, becoming the latest of the tech giants to slash its workforce in an increasingly uncertain economic climate.

Amazon employees were called into meetings with their managers across the country Tuesday, and many were told they had two months to find another job internally or accept severance payment.

The e-commerce giant is expected to cut about 10,000 workers, or 3 percent of its corporate workforce. The company started communicating the layoffs to employees Tuesday afternoon, according to people familiar with the matter who spoke on the condition of anonymity to describe sensitive matters.

Amazon plans to cut thousands of corporate workers

Within hours of the layoffs beginning, employees started posting on LinkedIn and anonymous workplace app Blind to say they had been cut and were looking for new jobs.

Inside Amazon, employees say they have been told little about the layoffs — they have not received any companywide communication or notices, said two corporate workers who spoke on the condition of anonymity to discuss sensitive matters.

Several employees were laid off from Amazon’s Alexa team, which works on the voice assistant technology, and layoffs occurred in Boston, Seattle, Vancouver and the Bay Area, according to screenshots of the company’s internal Slack messages shared by an employee who spoke on the condition of anonymity to protect their job.

In the chat app, employees discussed being called to meetings with their managers and human resources to deliver the news.

“Seeing these ‘I Got Laid Off’ posts is horribly distressing,” one anonymous employee wrote in Slack. “This is horrible :(”

The cuts are expected to affect mostly areas such as retail, human resources and devices. Earlier this month, Amazon announced a broad hiring freeze among its white-collar workforce that would last at least “the next few months.”

The cuts are expected to be the e-commerce giant’s largest round of layoffs in its history, marking a big turnaround for a company that has hired aggressively over the past decade.

Amazon is expected to continue hiring in its warehouses, where it is adding staff to support its busy holiday season.

The company didn’t respond to a request for comment.

Employees posted goodbye notes to their colleagues in Slack along with their layoff announcements.

“I cannot thank you enough for the lessons you’ve taught me and the friendships you’ve so freely given,” one anonymous employee wrote. “I will miss working with you and wish you all great things.”

In recent weeks, Twitter, Salesforce, Facebook parent Meta and other technology companies have announced significant layoffs or hiring freezes, following months of warning signs, such as tech start-ups finding it harder to raise capital.

Dan Ives, a financial analyst with Wedbush Securities, told The Washington Post on Monday that the layoffs may signal an imminent recession. Tech companies, he said, “got significantly bloated, and they’re not built for a softer economy like we’re seeing.”

Meta cut 11,000 jobs, or 13 percent of its workforce, last week. Ride-hailing service Lyft also shed 13 percent of its staff. Financial technology firm Stripe and real estate marketplace Zillow have also announced layoffs since October.

This month, Twitter CEO Elon Musk cut half his company’s staff shortly after acquiring the social network.

Twitter slashes its staff as Musk era sets in

Mass layoffs represent a sharp reversal for Amazon, which has been expanding for much of its history. At the end of September, it employed more than 1.5 million workers, a 5 percent increase from the year before. (Amazon founder Jeff Bezos owns The Post.)

Amazon saw huge growth during the coronavirus crisis, as people spent more time at home and increasingly did their shopping online. In May, the company acknowledged that it had staffed up too quickly at its warehouses to keep pace with demand, which by then was cooling.

Moreover, in the face of high inflation and increasingly budget-conscious consumers, Amazon issued a disappointing forecast for the holiday season — typically its strongest time of the year — sending its stock plummeting last month. Amazon’s stock has tumbled nearly 39 percent since the beginning of the year, though it still has a market capitalization above $1 trillion.

Josh White, an assistant professor of finance at Vanderbilt University, said the layoffs at Amazon were more alarming than those at other large tech companies “because Amazon is very consumer-focused, and so far the consumer has hung in there.”

“They have technology, and they have the ability to see trends or maybe a potential slowdown in consumer spending,” he told The Post. “And that starts pushing us into that potential recession.”

Mandy Dean, 39, was a contract recruiter in Chicago for Amazon Luna, the company’s cloud gaming platform. The company let her contract expire in September, although she said she was on track to interview to go full-time.

It wasn’t a total surprise: Dean said she saw the signs in August, as the software engineer openings she was tasked with filling dwindled.

“It was bad timing for it all to happen,” Dean said. “I really liked working for Amazon. I liked the culture, the people I worked with, the job itself. It was a rough situation, but there was nothing I could do.”

Caroline O’Donovan contributed to this report.