Amazon Begins Layoffs, Sees Decline in Retail Sector

Amazon started laying off employees this week. Managers reportedly have begun advising staff members that they have two months to transfer to another position within the firm or accept dismissal. 

Current Happenings

According to TechCrunch’s report, numerous workers have spoken about the effect of the changes on social media platforms like LinkedIn.

Meanwhile, other stories highlight employees’ disappointment that the corporation has not issued any company-wide announcements acknowledging the size and extent of the cutbacks. 

The announcement confirms what many had suspected for weeks; that CEO Andy Jassy was speeding up the company’s ongoing cost-cutting measures. 

News of the business’s intention to lay off 10,000 workers, or around 3% of the whole workforce, came earlier this week. This was after rumors that the firm was explicitly eyeing its devices sector.

This would be the biggest workforce decrease in the almost 30-year history of the e-commerce and cloud computing giant.

Amazon’s company cloud gaming service Luna, as well as retail and HR, are reportedly affected. These employee reductions occurred less than two months after Google announced shutting down its rival streaming platform, Stadia.

Read Also: Amazon Loses $1.88 Trillion in Market Value Due to Rising Inflation, Monetary Policies, and Low Earnings

Financial Performance

Last week, a corporate representative told TechCrunch that both their established companies and more recent businesses, such as Prime Video, Alexa, Grocery, Kuiper, Zoox, and Healthcare, have promising futures. 

As part of the company’s annual operational plan review that takes place in the autumn of each year, its top-level management team evaluates the investment forecast and financial performance. 

The spokesperson said that the present macroenvironment and potential cost-cutting measures are, of course, factors in this year’s evaluation.

The statement, according to TechCrunch, acknowledged the significant financial difficulties businesses of all sizes have been experiencing. 

Amazon’s devices division, which includes the Echo Products, Fire Tablets, and the Alexa company, was said to be losing $5 billion annually in sales, making it a potential target for axing.

In the face of a weaker economy and decreasing growth in its retail division, Jassy has aggressively cut spending throughout the firm in recent months. 

The company has suspended certain experimental initiatives and closed, delayed, or canceled new warehouse sites, CNBC reported.

The last-mile delivery robot Scout was recently discontinued as part of a larger restructuring of its robotics group.

It has used a long-tail approach to increase Alexa’s popularity, but Jassy seems to be focusing in particular on markets where rapid expansion is essential. 

Employee Count

A year ago, Amazon struggled to find enough workers in a tight labor market. It was in the middle of a recruiting spree driven by the global Covid-19 outbreak.

CNBC said the company almost increased its staff from 798,000 to 1.6 million between 2019 and 2021.

Since then, it has slowed down its hiring policies since customers are flocking back to physical shops, and the retail sector as a whole is no longer expanding at a breakneck pace. 

Last month, Amazon’s CFO Brian Olsavsky warned that shoppers are starting to feel the effects of rising prices.

See Also: Amazon Taps India For its Shipping Service Expansion

This article is owned by Tech Times

Written by Trisha Kae Andrada

ⓒ 2022 All rights reserved. Do not reproduce without permission.

Leave a Reply

Your email address will not be published. Required fields are marked *