Amazon To Lay Off A Record-Breaking Number Of Employees From Its Busiest Divisions
Amazon will lay off more than 18,000 workers in the coming months with the largest number occurring in the retail and recruiting divisions.
Amazon is about to outdo itself in the worst way possible. Back in November, the e-commerce giant admitted that it was planning to let go of about 10,000 of its workers in the coming months. Now, 10,000 looks like a drop in the bucket after Amazon stated layoffs would amount to more than 18,000 when all is said and done.
The reasons behind mass Amazon layoffs are akin to Meta’s reasons for laying off a large swath of its workers. Both Amazon and Meta saw record growth during the pandemic (really, the entire tech sector did). As a result of the unprecedented amount of growth, both companies overdid it with hiring.
The thing is, that growth wasn’t permanent and that impermanency has begun to rear its ugly head in the form of dwindling profits. Meta CEO Mark Zuckerberg even admitted that he mistakenly thought the company’s prosperity was permanent and that he overhired because of that misbelief. Amazon is in the exact same boat, hence why all the layoffs are occurring.
Responding to the Amazon layoffs, CEO Andy Jassy acknowledged that Amazon is going through a difficult period but also expressed his confidence that the company can successfully navigate its current predicament. “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” Jassy wrote in a blog post.
Furthermore, Jassy specified that the layoffs would largely be concentrated in two areas – recruiting and retail. This makes sense. These were two departments that ballooned during the height of the pandemic. The Wall Street Journal reported that employees in those divisions affected by the Amazon layoffs will lose their jobs by the end of January.
Moreover, Layoffs aren’t just happening at giants like Amazon and Meta, layoffs are happening across industries at a long list of companies. Netflix, 7-Eleven, Party City, Lyft, and Salesforce are just a handful of companies laying off workers. Then, of course, there is Twitter, but the situation there is something entirely unto itself.
The point is all of these companies are coming down from the high they were riding during the height of the pandemic and facing the present reality plaguing their businesses. Much like most US residents, businesses are feeling the symptoms that go along with the Federal Reserve’s aggressive efforts to shrink the economy and put an end to a sustaining period of intense inflation. The Amazon layoffs are one real-world example of this.
Regardless of the cause, the Amazon layoffs, along with the swaths of other companies taking the same course of action, are concerning. Some industry analysts believe that all of these layoffs are a precursor to a recession that many fear will erupt. That said, more than 235,000 jobs were added in December, which was a figure higher than what was initially predicted.
Additionally, last week’s jobless claims fell to their lowest levels in at least three months. This combination suggests that the US job market is still thriving. Thus, right now, it’s really anyone’s guess what will happen in the coming months.
Recession? No recession? More mass layoffs? More jobs added? It all remains to be seen.
