Amazon to cut over 18,000 jobs citing economic uncertainty

Amazon has announced it will cut more than 18,000 jobs from its workforce, the largest set of layoffs in the US company’s history, as it battles to save costs.

The company’s e-commerce and human resources departments will be primarily impacted by the layoff decisions, which Amazon will announce on January 18.

The layoffs represent 6 per cent of Amazon’s almost 300,000 corporate employees and are a striking turnabout for a business that just tripled its base pay level in an effort to compete more fiercely for talent, according to BBC.

With around 1.5 million employees overall, including warehouse workers, Amazon is the second-largest private employer in the United States (US), after Walmart Inc.

CEO Andy Jassy claimed in the message that the unstable economy and the increased hiring over the last few years have made this year’s annual planning more difficult.

Amazon, whose stock price has more than halved in the past year, has prepared for slower growth as rising inflation has led both businesses and consumers to reduce spending. The company’s financial situation has drastically declined. It changed from a delivery service that was deemed essential during the epidemic to one that was overbuilt in comparison to overall demand.

Jassy’s statement was published after the Wall Street Journal reported that over 17,000 staff would be let go. He claimed that as a result of a leak, Amazon decided to break the news without first informing worried staff.

Amazon plans to pay severance and is still required to submit some legal notices regarding significant layoffs. Jassy claims that Amazon has survived unstable and difficult economic times in the past and will do so in the future.