Amazon.com Inc said yesterday that it would reduce its global corporate workforce by about 14,000 people, with more cuts expected next year, in a major shakeup driven in part by adoption of artificial intelligence (AI) at the tech giant.
The online retailer began laying off employees across multiple divisions as part of a plan, first reported on Monday by Reuters, to cut as many as 30,000 employees. Amazon is working to compensate for over-hiring during the peak demand of the COVID-19 pandemic and limit costs.
The layoffs offer an early look at the broad effects that AI could have on workforces. Amazon CEO Andy Jassy flagged the possibility of such losses in June, saying increased use of AI tools and agents would lead to more corporate job cuts, particularly through automating routine tasks.
Photo: Damien Eagers, Reuters
Amazon had about 1.56 million full-time and part-time employees at the end of last year. Its corporate workforce includes roughly 350,000 employees.
Workers told Reuters they learned their jobs were eliminated from letters sent to their personal email addresses early yesterday morning.
"You are no longer required to perform work on Amazon’s behalf," reads the email from Beth Galetti, senior vice president of People Experience and Technology, that was sent to impacted employees and seen by Reuters.
She said those workers would be given the option to meet with a human resources employee over video call. "Unfortunately, your role is being eliminated and your employment will end after a non-working period."
Amazon will offer most affected workers 90 days to look for a new role internally and said its recruiting teams would prioritize those candidates.
Departments affected by the job cuts include devices, advertising, Prime Video, HR and Amazon’s cloud computing unit Amazon Web Services (AWS), employees told Reuters.
It was not immediately clear over what period the full target of 30,000 job cuts will take place, but Galetti said in the note Amazon would continue hiring in certain areas and reducing headcount in other divisions heading into next year.
Over the past two years, the company has been carrying out piecemeal job cuts across divisions including books, devices and its Wondery podcast business. The layoffs so far have already helped teams move faster, Galetti said.
Galetti’s note reiterated Jassy’s push to reduce management layers and lean more on AI.
Corporations are increasingly using the technology to write code for their software and adopting AI agents to automate routine tasks, as they look to save costs and cut reliance on people.
"This generation of AI is the most transformative technology we’ve seen since the Internet, and it’s enabling companies to innovate much faster than ever before," Galetti said.
Amazon is expected to shell out roughly US$118 billion in capital expenditures for the year, with much of it going towards building AI and cloud infrastructure. The company will report its third-quarter earnings on Thursday.
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