Amazon said it is slashing a total of 18,000 jobs, a larger number of positions than it previously announced and the largest set of layoffs in the e-commerce giant’s history.
“We typically wait to communicate about these outcomes until we can speak with the people who are directly impacted,” CEO Andy Jassy said in a note to employees that the company made public on Wednesday. “However, because one of our teammates leaked this information externally, we decided it was better to share this news earlier so you can hear the details directly from me.”
Jassy said the layoffs will mostly impact the company’s brick-and-mortar stores, which include Amazon Fresh and Amazon Go, and its PXT organizations, which handle human resources and other functions.
In November, he told staff the layoffs were coming due to the economic landscape and the company’s rapid hiring in the last several years. Wednesday’s announcement included earlier job cuts that had not been numbered. The company had also offered voluntary buyouts and has been cutting costs in other areas of its sprawling business.
Amazon, which has a total global workforce of 1.5 million, is one of a number of major tech companies shedding workers after hiring aggressively in recent years.
Salesforce, a maker of customer management software, said Wednesday it is laying off more than 7,000 people, or roughly 10% of its workforce, as well as closing some offices. The cuts are by far the largest in the 23-year history of a San Francisco company founded by former Oracle executive Marc Benioff, who pioneered the method of leasing software services to internet-connected devices — a concept now known as “cloud computing.”
“As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that,” Benioff wrote in a letter to employees.
Salesforce employed about 49,000 people in January 2020 just before the pandemic struck. Salesforce’s workforce today is still 50% larger than it was before the pandemic.
Apple, Facebook parent Meta Platforms, Microsoft, Netflix, Peloton, Twitter and other tech companies have announced sizable layoffs or scaled back hiring in recent months amid weakening economic growth.
Meta CEO Mark Zuckerberg also acknowledged he misread the revenue gains that the owner of Facebook and Instagram was reaping during the pandemic when he announced in November that his company would be laying off 11,000 employees, or 13% of its workforce.
Employers “are getting aggressive in slashing costs (which will help support earnings amid a tougher revenue environment),” Wall Street analyst Adam Crisafulli of Vital Knowledge said in a report to investors.
Overall, tech industry companies cut more than 97,000 jobs in 2022, up 649% from the roughly 13,000 eliminated the previous year, according to outplacement firm Challenger, Gray & Christmas. That far outpaced the automotive sector, which cut 31,000 workers last year, the second-most of any U.S. industry.
“The overall economy is still creating jobs, though employers appear to be actively planning for a downturn. Hiring has slowed as companies take a cautious approach entering 2023,” said Andrew Challenger, senior vice president of Challenger, Gray & Christmas.