Amazon cuts 18,000 jobs due to economic uncertainty Amazon

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Amazon announced it will cut more than 18,000 jobs from its workforce — the largest set of layoffs in the US company’s history — while business software maker Salesforce will cut 8,000 workers in its latest tech job purge.

Amazon cited an “uncertain economy” and said the e-commerce giant has “hired quickly over the past several years” in Wednesday’s announcement.

“Between the cuts we made in November and those we’re sharing today, we plan to cut just over 18,000 jobs,” its CEO, Andy Jassy, ​​said in a note to employees.

He said Amazon has weathered “tough economies” in the past and will continue to do so. “These changes will help us pursue our long-term opportunities with a stronger cost structure.”

Jassy said the layoffs will mostly affect the company’s traditional stores, which include Amazon Fresh and Amazon Go, and PXT Enterprises, which handle human resources and other functions.

He didn’t specify where the affected roles were, but Jassy said in the statement that Amazon will be communicating with affected employees “or where applicable in Europe, with employee representative bodies” starting January 18.

The job cuts mark a rapid shift for the retailer, which recently doubled its base pay cap to compete more aggressively for talent.

The layoffs amount to 6% of Amazon’s roughly 300,000-strong workforce. It has a global workforce of over 1.5 million.

In November, Jassy told employees the layoffs are coming because of the company’s rapid hiring and economic landscape in the past several years. Wednesday’s announcement included previous job cuts that were not numbered. The Seattle-based company also offered voluntary buyouts and cut costs in other areas of its sprawling business.

Meanwhile, Salesforce said it will lay off about 8,000 employees, or 10% of its workforce.

The cuts announced Wednesday are the largest in the 23-year history of the San Francisco company founded by former Oracle CEO Marc Benioff. He pioneered the method of leasing software services to Internet-connected devices – a concept now known as “cloud computing”.

The layoffs follow a change in the senior ranks at Salesforce. Benioff’s handpicked co-CEO Brett Taylor, who was also Twitter’s chairman at the time of its painstaking $44 billion sale to billionaire Elon Musk, recently left Salesforce. Soon after, Slack founder Stewart Butterfield left. Salesforce bought Slack two years ago for roughly $28 billion.

According to the company, Salesforce workers who lose their jobs will receive approximately five months of pay, health insurance, job resources and other benefits. Amazon said it also offers severance payments, transitional health insurance benefits, and employment support.

Benioff, now Salesforce’s sole CEO, told employees in a letter that he blamed himself for the layoffs after continuing to hire aggressively during the pandemic, as millions of Americans work from home and the company’s technology is in high demand.

“With our revenue accelerating during the pandemic, we hired way too many people which led to this economic downturn we’re in right now, and I take responsibility for that,” Benioff wrote.

Salesforce employed about 49,000 people in January 2020, just before the pandemic hit. Today’s Salesforce workforce is still 50% larger than it was before the pandemic.

Meta Platforms CEO Mark Zuckerberg also admitted he misread the revenue gains the Facebook and Instagram owner was reaping during the pandemic when he announced in November that his company would lay off 11,000 employees, or 13% of its workforce.

The Associated Press, Reuters and AFP contributed to this report

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