Amazon is getting smaller, and I’m not talking about the rainforest.
Amazon is laying off 10,000 corporate members
Technology giant Amazon, known for its e-commerce service, has plans to lay off approximately 10,000 people in their corporate and technology sector. The affected divisions comprise the devices division, retail division, as well as human resources division.
Currently, Amazon is said to have upwards of 1.5 million staff members, most of whom are hourly workers. The planned retrenchment is said to only affect the corporate members, which make up less than 1% of Amazon’s workforce, and around only 3% of its corporate workforce.
Major tech companies are now falling like dominos, and Amazon is the latest company to join the party. Companies such as Meta, Twitter, and Apple have recently let go of many staff members as well.
You can watch this video to know the main reason behind the layoffs:
Explaining the situation
Our digitalised world is moving rapidly. It feels like just yesterday blackberry was a fruit, and today it’s a dead phone brand. Business models are changing and the economy is unpredictably volatile.
In the pandemic period, many tech companies capitalised on the lack of human connection and soared, leading them to make a wrong forecast about the post-pandemic period.
As such, they are now overstaffed and underdelivering. Cut-throat competition in the technology sector as well as the soaring global economy has hence placed greater pressure to trim down such companies.
The pandemic period has birthed Amazon’s most profitable era. Confined to their homes, many resorted to the internet to satisfy their cravings.
Shopping? No, online shopping.
Cinemas? No, streaming platforms.
Eating out? No, order in.
Throughout the pandemic, Amazon has received a nearly 200% increase in profits and has doubled its workforce. They have reinvested their earnings into expansion and innovation.
Evidently, increasing demand for cloud computing services has led Amazon to inflate their bubble.
Sadly, the bubble has burst.
Post-pandemic hit the company like a truck. People’s online habits took a drastic turn, and Amazon’s growth could not sustain their expenditure. The decisions to overinvest and expand, as well as the turn in customer habits and high inflation led Amazon to experience the lowest growth rate in two decades.
From April to September, Amazon has reduced its company population by almost 80,000 workers, mostly shrinking its hourly staff size.
In September, they froze hiring across the company and in October, it paused the filling up of over 10,000 open roles in its retail business. Its retail business covers both physical and online platforms and has been under great strain during the pandemic, forcing it to expand.
So yes, this isn’t unexpected.
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