Amazon is laying off 18,000 employees, the tech giant said Wednesday, the highest number of jobs cut at a tech company since the industry began aggressively cutting its workforce last year.
In a blog post, Amazon CEO Andy Jassy wrote that the staff cuts were triggered by the uncertain economy and the company’s rapid hiring in recent years.
The cuts will primarily affect the company’s workforce and will not affect hourly warehouse workers. In November, Amazon reportedly planned to lay off about 10,000 employees, but on Wednesday Jassy estimated the number of jobs the company needed to cut was more than that, as he said, “just over 18,000 “.
Jassy attempted to strike an optimistic note in Wednesday’s blog post announcing the massive staff reduction, writing, “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so.
While 18,000 is a lot of jobs, it’s just over 1% of the 1.5 million workers employed by Amazon in the company’s warehouses and offices.
Last year, Amazon was the latest Big Tech company to see growth slow after its pandemic-era tear, just as inflation was at a 40-year high.
News of Amazon’s cuts came the same day enterprise software giant Salesforce announced its own round of layoffs, eliminating 10% of its workforce, or about 8,000 jobs.
Salesforce co-CEO Mark Benioff attributed the reduction to a line now oft-repeated in Silicon Valley: pandemic boom times have caused the company to hire too zealously. And now that there has been a pullback in business spending, the focus is on cutting costs.
“As our revenues have accelerated during the pandemic, we have hired too many people leading to this economic downturn we are currently facing,” Benioff wrote in a memo to staff.
Facebook owner Meta, as well as Twitter, Snap and Vimeo, have all announced major staff cuts in recent months, a remarkable turnaround for an industry that has seen meteoric growth for more than a decade.
For Amazon, the pandemic has been a huge boon to its bottom line, with online sales surging as people shun in-store purchases and the need for cloud storage has exploded with more businesses and governments moving their operations online. And that, in turn, has led Amazon to embark on a hiring spree, creating hundreds of thousands of jobs over the past few years.
The layoffs at Amazon were first reported on Tuesday by the wall street journalI.
CEO Jassy, in his blog post, acknowledged that although the company’s hiring has gone too far, the company intends to help cushion the blow for laid-off workers.
“We are working to support those affected and are offering packages including severance pay, transitional health insurance benefits and external job placement assistance,” Jassy said.