Amazon confirms that it will cut more than 18,000 jobs!
The global economy continues to be sluggish, the outlook for the US economy is gloomy, and the big cargo owners can no longer continue to wait. On January 5, 2023, Amazon, a large US seller, announced a large layoff on its official website, with an unprecedented scale of layoffs. Amazon CEO Andy Jassy said in an announcement that the company is cutting more than 18,000 employees as part of previously disclosed layoffs. The layoffs will affect many teams, involving Amazon stores and people, experience and technology (PXT), and other departments. Amazon plans to communicate with more than 18,000 affected employees starting January 18. It would be the largest layoff announced by a major technology company until now. Amazon has more than 1.5 million employees including warehouse workers as of September 2022. Amazon has faced uncertain and difficult economic environments in the past, and it will continue to do so in the future.
Since last year, the cold air of the global economy is spreading to every corner. Affected by Covid-19, online orders have surged, e-commerce was growing rapidly, and companies such as Amazon have greatly increased their recruitment in the past few years. Financial report data show that in 2018, Amazon had 560,000 employees, and as of December 31, 2021. The number of employees has reached about 1.6 million. There is an increase of 186% in three years. Until November 2022, according to the New York Times, Amazon has already laid off about 10,000 employees in the equipment department, retail department, and human resources department. At that time, Amazon’s largest layoffs caused a sensation in the cross-border e-commerce industry. Some Amazon employees publicly stated: “The cost-cutting measures in the past few months are the most severe we have ever experienced.” In just two months, the technology giant has begun a larger layoff.
Amazon has been preparing for a sharp slowdown in e-commerce growth as soaring inflation causes businesses and consumers to retrench. Amazon delayed warehouse openings and stopped hiring. Amazon has previously acknowledged that, since the current macroeconomic environment and rapid hiring over the past few years, some teams are making adjustments, which in some cases means some roles are no longer needed. According to data, in July 2021, Amazon’s market value reached a high of $1.88 trillion. However, a year and a half later, Amazon did not break through $2 trillion but fell downwards. By November 2022, Amazon will become the world’s first listed company whose market value has shrunk by more than $1 trillion. As of January 4, 2023, Amazon’s market capitalization was only $868.5 billion.
Amazon’s financial report shows that in the third quarter of 2022, Amazon’s net sales were $127.101 billion, a year-on-year increase of 14.7%, but lower than market expectations of $127.6 billion; net profit was $2.872 billion, a decrease of 9% compared to the same period last year. Amazon made targeted cuts to reduce costs last spring and summer, closing some underperforming physical stores and shutting down business units like Amazon Care. Earlier, Amazon also said that it would close three of its businesses in India: food delivery, educational technology business, and e-commerce wholesale site, due to failure to achieve profitability in India.
A wave of layoffs hit the tech industry last year, with giants including Twitter, Meta, and Netflix all laying off thousands of workers. This trend has not shown signs of slowing down in 2023. Software service provider Salesforce announced on Wednesday local time that it will cut 10% of its workforce, involving about 7,000 jobs, and close some offices. The reason is similar to Amazon. The company’s CEO Marc Benioff admitted that due to the rapid growth of business during Covid-19, the company hired too many employees. Reducing costs and increasing efficiency has gradually become the main theme of giants and even every small and medium-sized enterprise.
