Amazon is set to reduce up to 30,000 corporate jobs starting this week to streamline operations and address overstaffing during the peak of the pandemic. This cut, while a small fraction of Amazon’s massive workforce of 1.55 million employees, accounts for nearly 10% of its 350,000 corporate staff. It marks the largest job reduction for Amazon since late 2022 when around 27,000 positions were eliminated.
Various divisions within Amazon, including devices, communications, and podcasting, have experienced smaller job cuts over the past couple of years. The current round of layoffs is expected to impact divisions such as human resources (People Experience and Technology or PXT), operations, devices and services, and Amazon Web Services.
Amazon’s CEO, Andy Jassy, is leading an effort to streamline the company’s operations by reducing bureaucracy, including trimming the number of managers. Jassy has implemented an anonymous complaint line to identify inefficiencies, resulting in over 450 process changes based on 1,500 responses received earlier this year. The company is also looking to leverage artificial intelligence tools to automate routine tasks, potentially leading to further job cuts.
Analysts suggest that Amazon’s focus on AI-driven productivity gains is driving these job cuts to optimize corporate teams and offset long-term investments in AI infrastructure. The exact scale of the layoffs is yet to be fully disclosed, with estimates subject to change based on Amazon’s evolving financial priorities. Speculation indicates that the human resources division could face a reduction of approximately 15%.
Despite efforts to bring employees back to the office full-time, attrition rates have not met expectations. Some employees who have not returned to the office due to various reasons are being classified as voluntarily quitting, leading to their departure without severance benefits. This move is seen as a cost-saving measure for the company.
In the tech industry, layoffs have been prevalent, with an estimated 98,000 jobs lost across 216 companies in the current year, compared to 153,000 job cuts in 2024. Amazon’s cloud computing division, AWS, reported a 17.5% increase in second-quarter sales, falling behind competitors like Microsoft’s Azure and Google Cloud. Despite a recent internet outage affecting AWS services, the company anticipates a strong holiday season and plans to hire 250,000 seasonal workers to support warehouse operations.
Furthermore, Amazon recently restructured a segment of its PXT unit focusing on diversity initiatives, primarily through internal promotions. The company’s shares saw a 1.2% increase on Monday, closing at $226.97, with third-quarter earnings scheduled for release later in the week.