Amazon CEO says job cuts to exceed 18,000 roles

Amazon.com Inc’s layoffs are now increasing to more than 18,000 roles, as part of a workforce reduction that was previously disclosed by Chief Executive Andy Jassy, in a public note to staff on Wednesday.

Amazon plans to announce layoffs on January 18th that will primarily affect the company’s e-commerce and human-resources divisions, a company spokesperson said.

The reductions, which represent about 6% of Amazon’s corporate workforce of roughly 300,000 people, come as the retailer recently doubled its base pay ceiling to compete more aggressively for talent.

Amazon is the second-largest private employer in the United States, with over 1.5 million workers, including warehouse staff.

After-hours trading saw a 2% increase in stock prices.

Given the current economy, annual planning has become more difficult, Jassy said in a note. He also mentioned that Amazon has been hiring rapidly over the past few years.

Inflation has been on the rise, which has encouraged businesses and consumers to cut back spending. As a result, Amazon has braced for likely slower growth. In the past year, its share price has halved.

The company began reducing its workforce in November from its devices division, with a source telling Reuters at the time it was targeting around 10,000 cuts.

The tech industry shed more than 150,000 workers in 2022, according to tracking site Layoffs.fyi, a number that’s continuing to grow. Salesforce Inc said Wednesday it planned to eliminate about 10% of staff, which numbered nearly 8,000 as of October 31.

This year has been difficult for the tech industry, with many companies shedding employees due to the pandemic.

Jassy’s note followed a report in the Wall Street Journal that the reduction would be more than 17,000 jobs. He said Amazon chose to disclose the news before informing affected staff because of a leak.

Amazon still must file certain legal notices about mass layoffs, and it plans to pay severance. Jassy said although this is a difficult time, “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.”