In November 2022, the Wall Street Journal reported that Amazon’s job cuts could reach 10,000 people.
If you think this is already a significant number, think again.
Today, according to the Wall Street Journal, Amazon is reportedly going to lay off more than 17,000 people instead, a number significantly bigger than previously planned.
Amazon is Reportedly Laying off 17,000 People
Apparently, the layoffs are concentrated within Amazon’s corporate ranks.
Based on Layoffs.fyi, a website that has been tracking tech company layoffs since the start of the COVID-19 pandemic, the dismissal of over 17,000 people is the highest number of people let go by a company in the past few months.
Thousands of Amazon’s job cuts began last year and will continue in the coming weeks, according to some unidentified people familiar with the situation.
Why is Amazon Laying Off so Many Employees?
Remember when nobody could go out during the 2020 circuit breaker?
Since everyone was stuck indoors, they flocked to online shopping. Whether they were buying groceries or laptops for e-learning, the significant increase in Amazon purchases grew the company.
As such, Amazon was one of the companies that benefited the most from the COVID-19 pandemic.
Thus, Amazon hired thousands of employees to keep up with the rapid increase in demand.
However, Amazon’s demand decreased as COVID-19 restrictions lifted and customers returned to pre-pandemic habits like going to physical stores to shop.
In 2022, Amazon’s growth slowed to the lowest rate in twenty years.
They initially tried to mitigate the issue by shutting down physical stores and business units like Amazon Care and having a companywide hiring freeze.
However, these efforts were insufficient, leading Amazon to decide to lay off employees.
Other reasons for the decision included a worsening economic climate.
If the world of tech giants boggles your brain, watch this video to learn more about this phenomenon:
Not the First Company to do so
Amazon is not the first company to lay off so many employees due to rapid hiring and growth during the pandemic.
Previously, Meta and Microsoft said they would need to cut thousands of jobs due to the looming economic recession.
On Wednesday, cloud computing giant Salesforce said it was laying off 10% of its employees.
How Amazon is Helping Affected Employees
Though Amazon did not provide details on its severance packages to the public, they’re reportedly helping its affected employees.
The Wall Street Journal reported that Dave Limp, Amazon’s senior vice president of devices and services, said that Amazon was helping affected employees find new jobs.
According to some employees, affected employees would get a severance pay ranging between a minimum of four weeks and a maximum of 20 weeks.
Meanwhile, Amazon investors have reacted positively to the company’s efforts to prepare for the coming economic climate, hoping that these job cuts will increase Amazon’s profits.
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