Amazon CEO Andy Jassy recently announced in a memo to staff that the company will eliminate 9,000 more jobs in the coming weeks, marking the second-largest round of layoffs in the company’s history. The layoffs come in addition to the 18,000 employees the company said it would lay off in January. Although Amazon’s workforce doubled during the pandemic due to a hiring surge across the tech sector, the company has had to make some tough decisions to remain competitive.
Jassy explained that the job cuts are part of the second phase of the company’s annual planning process, which involved assessing what areas of the business to trim. While Amazon will still hire in some strategic areas, profitable areas such as its cloud computing unit AWS, its burgeoning advertising business, and Twitch, the gaming platform Amazon owns, will be affected. Amazon’s PXT organizations, which handle human resources and other functions, will also see some layoffs.
Jassy clarified that not all the teams had completed their analyses in the late fall, which is why the company did not announce these role reductions alongside the ones announced a few months ago. He also emphasized the importance of conducting these assessments with appropriate diligence rather than rushing through them.
Amazon’s prior layoffs had also hit its PXT, the company’s stores division, which encompasses its e-commerce business, brick-and-mortar stores such as Amazon Fresh and Amazon Go, and other departments such as the one that runs the virtual assistant Alexa.
The pandemic led to an increase in demand for online shopping, prompting Amazon and other tech companies such as Facebook and Google to ramp up hiring. However, with the pandemic easing, demand has slowed, prompting Amazon to pause or cancel its warehouse expansion plans to prevent unnecessary financial losses. Additionally, earlier this month, the company announced it would pause construction on its headquarters building in northern Virginia, though the first phase of that project will open this June and welcome 8,000 employees.
