According to reports, Amazon intends to make the most significant reduction in staff in its history by letting go of about 10,000 workers. The company’s devices division, which includes the voice assistant Alexa, retail division, and human resources would be the main targets of the 10,000 job cuts, which could begin this week, according to the New York Times, which cited sources with knowledge of the plan but who were not authorized to speak publicly.
The layoffs would affect approximately 1% of its global workforce and 3% of Amazon’s corporate employees. The company employs over 1.5 million people worldwide. According to a recent report from market research firm Finbold, Amazon’s value has dropped by 45% in the last year, from $1.6 trillion on January 1 to $939 billion on November 3. Other companies, such as Apple and Microsoft, saw their stock prices fall.
In a statement to USA TODAY, Petra Moser, an economics professor at New York University, said that the loss in market value would most likely be felt through employment. Other major technology companies have made similar announcements in recent weeks. Thousands of employees were laid off at Twitter in early November, just one week after billionaire Elon Musk purchased the platform. After a few days, Facebook’s parent company Meta declared that it would lay off 11,000 employees, or roughly 13% of its staff, to “become a leaner and more efficient company.”
The New York Times article was published at the same time that Amazon revealed millions of deals would be offered during its 48-hour Black Friday event, which starts on November 24. The fact that Amazon is planning to make cuts during the holiday shopping season when the company has historically valued stability, reveals how quickly the faltering global economy has pressured Amazon to cut operations that have been overstaffed or underperforming for years.
In contrast to a New York Times article from October 4 that claimed Amazon would stop hiring for corporate positions in its retail division for the remainder of the year, Amazon announced plans to hire approximately 150,000 people for open seasonal, full-time, and part-time positions “across its operations network in the U.S. to help deliver for customers during the holidays.”
On October 27, Amazon revealed the financial results of its third quarter, revealing that while net sales had increased by more than 15% from the same period in 2017, operating income had dropped to $2.5 billion from $4.9 billion.