ALBAWABA — Amazon announced workforce layoffs on Wednesday, blaming rapid hiring during the Covid-19 pandemic and the worsening global economic outlook.
"Between the reductions we made in November and the ones we're sharing today, we plan to eliminate just over 18,000 roles," said CEO Andy Jassy in a statement to staff.
Its stock fell more than 1 percent on the news on Thursday, having already lost 50 percent of its value from a year ago.
Media reports in November said that Amazon was planning to lay off 10,000 employees, but no figures were given by Amazon until now.
According to Jassy, stores operated by the group and human resources would primarily be affected.
Amazon’s workforce reduction is the largest among recent tech layoffs that have impacted the once-mighty US sector.
"We are working to support those who are affected and are providing packages that include a separation payment, transitional health insurance benefits, and external job placement support," Jassy said, noting that impacted workers would be informed starting on January 18.
"This year's review has been more difficult given the uncertain economy and that we've hired rapidly over the last several years," Jassy said in the memo posted on aboutamazon.com, adding "Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so."
During the pandemic Amazon doubled its global staff from the start of 2020 and the start of 2022, having 1.54 million employees worldwide at the end of September, not including seasonally-recruited workers.
Amazon saw its net profit drop 9 percent year on year in the third quarter, while in November it anticipated lackluster 4th quarter growth.
Amazon is expected announce its annual results on February 1.
Amazon’s business, along with many techs, boomed during the pandemic as consumers turned to online shopping for their needs.
Amazon and other tech companies have acknowledged they failed to accurately gauge pandemic demand, as consumers shift back to in-person shopping.
At the end of August, Snapchat let go about 20 percent of its employees, around 1,200 people. Meta in November announced the largest job cuts in the company’s history, around 11,000 workers.
Twitter cut its workforce by half after Elon Musk bought the company for $44 billion. Salesforce on Wednesday said it would cut 10 percent of its staff, or just under 8,000 employees.
