Amazon to fire over 18,000 employees amid restructuring move
What's the story
The ongoing layoffs at Amazon will affect more than 18,000 employees, CEO Andy Jassy said in a public memo to the staff.
The company had begun eliminating roles last November. However, the newly confirmed number is significantly higher than what was previously rumored.
The New York Times reported in November that Amazon plans to cut around 10,000 jobs.
Context
Why does this story matter?
With the announcement that it plans to cut "just over 18,000" jobs, Amazon has broken the record set by Meta last year. The layoffs will account for 6% of the company's nearly 300,000-large corporate workforce.
Amazon's shift in fortunes is tied to its hiring spree during the pandemic. In the post-pandemic world which is troubled by macroeconomic headwinds, the large workforce became a curse.
Impact
The layoffs will affect employees in Amazon Stores, PXT organizations
In his memo, Jassy said that the "majority" of job cuts would affect Amazon Stores and People, Experience, and Technology (PXT) organizations.
PXT organization (human resources) was among those first affected by the layoffs as well. The company also targeted employees in the devices and service organization, retail division, and Luna and Alexa departments in the previous round of firing.
Leaked info
Someone leaked the information about layoffs to the press
The news of Amazon's expanded layoffs was first reported by The Wall Street Journal. In the memo, Jassy said that the company will "typically wait to communicate about these outcomes until we can speak with the people who are directly impacted."
He added that the reason for sharing the news is that someone from the team had leaked the information to the press.
Reasons
Uncertain economy and increased hiring main reasons behind mass layoffs
Jassy attributed the mass layoffs to an uncertain economy and the company's hiring spree. This is in stark contrast to last year when Amazon doubled its base pay ceiling to compete for talent.
He said that fired employees will be provided severance packages, including separation payments, transitional health insurance benefits, and external job placement support.
Impacted employees will be communicated with starting January 18.