The CEO of Amazon Andy Jassy predicts that more than 18,000 jobs will be terminated.

Representative image. Credit: AFP Photo

The 300,000-person corporate workforce of Amazon will be reduced by 6% as a result of the cuts, which mark a swift turnabout for the retailer after it recently boosted its base wage ceiling in an effort to attract talent more aggressively.

Amazon.com Inc. (AMZN.O) Chief Executive Andy Jassy announced in a public statement to staff on Wednesday that layoffs will now total more than 18,000 positions as part of a previously revealed personnel reduction.

The company's human resources and e-commerce departments will be significantly impacted by the layoff choices, which Amazon will announce starting on January 18, he added.

After Walmart Inc., Amazon is the second-largest private employer in the United States with about 1.5 million employees, including warehouse staff (WMT.N).

Since its stock price has decreased by half over the past year due to soaring inflation, Amazon has prepared for expected slower growth. An insider told Reuters at the time that the corporation planned to make about 10,000 personnel reductions when it started laying off workers in its device division in November.

According to the tracking website Layoffs.fyi, the tech sector laid off more than 150,000 workers in 2022, and that number is expected to rise. Salesforce Inc. (CRM.N) announced on Wednesday that it would be laying off around 10% of its workforce, which stood at almost 8,000 as of October 31.

It has been a difficult turnaround for Amazon. It changed from being a firm that was considered important during the epidemic to supply items to abandoned homes to one that had overbuilt to meet demand. The 11,000 layoffs announced by Facebook parent Meta Platforms Inc. last year have now been surpassed by their layoffs (META.O).

The note from Jassy came after the Wall Street Journal reported that more than 17,000 jobs will be lost. He claimed that due to a leak, Amazon decided to break the news before alerting the impacted personnel. Regarding mass layoffs and severance payments, Amazon has not yet submitted necessary legal notices.

"Amazon has endured unpredictable and challenging economies in the past, and we will continue to do so," added Jassy.

Source: Reuters