Amazon will cut 14,000 roles as the tech giant doubles down on artificial intelligence and data centre spending.
The job cuts come just months after Amazon CEO Andy Jassy said that the introduction of AI at the company means it “will need fewer people” in some roles, and that its corporate workforce will shrink due to “efficiency gains from using AI”.
In a memo to staff sent earlier this week, Amazon senior vice-president of people experience and technology Beth Galetti said the layoffs are part of the company’s efforts to be the “world’s largest startup” by removing bureaucracy and managerial layers.
“The reductions we’re sharing today are a continuation of this work to get even stronger by further reducing bureaucracy, removing layers and shifting resources to ensure we’re investing in our biggest bets and what matters most to our customers’ current and future needs,” Galetti said in the memo.
“We’re convinced that we need to be organised more leanly, with fewer layers and more ownership, to move as quickly as possible for our customers and business.”
Despite the huge layoffs, Amazon is still expecting to hire in strategic areas and ramp up AI spending across the board, Galetti said.
“Some may ask why we’re reducing roles when the company is performing well,” she said.
“Across our businesses, we’re delivering great customer experiences every day, innovating at a rapid rate, and producing strong business results.
“What we need to remember is that the world is changing quickly.
“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.”
Major tech job cuts
Amazon’s corporate workforce comprises about 350,000 people, with the latest job cuts equating to a 4 per cent reduction.
Impacted Amazon employees have already been notified, and they will have the opportunity to find a new role internally, Galetti said in the memo.
“We’re working hard to support everyone whose role is impacted, including offering most employees 90 days to look for a new role internally, and our recruiting teams will prioritise internal candidates to help as many people as possible find new roles within Amazon,” the memo said.
Those who do not find another internal job will be provided with severance pay, outplacement services and health insurance benefits.
According to layoffs.fyi, the latest Amazon job cuts are among the biggest for a large tech firm in recent years.
In July, Intel announced plans to cut more than 30,000 jobs by the end of the year, while Tesla also slashed 14,000 roles early last year.
Meta layoffs
The Amazon job cuts come soon after fellow tech company Meta announced layoffs of its own, with 600 jobs to be cut from the social media company’s AI division, Superintelligence Labs.
An internal memo sent to staff by Meta chief AI officer Alexandr Wang said this would make it easier to get work done more efficiently.
“By reducing the size of our team, fewer conversations will be required to make a decision, and each person will be more load-bearing and have more scope and impact,” Wang said in the memo.
Meta CEO Mark Zuckerberg at the start of the year flagged job cuts at the company, including plans to lay off 3,600 of its lowest performing workers.
Zuckerberg said Meta would be doing “more extensive performance-based cuts during this cycle” and this would involve “moving out low-performers faster”.
Amazon initiatives
Late last year Jassey launched the “bureaucracy mailbox”, with employees asked to submit examples of “unnecessary process that’s crept in” and can be rooted out.
Amazon has announced significant spending on AI infrastructure such as data centres in recent months, including $US10 billion to build a campus in North Carolina to expand its cloud computing and AI operations.
The tech giant also earlier this year pledged to spend $20 billion on Australian data centres from 2025 to 2029, including the construction of new data centres in Sydney and Melbourne.
