Business strategy

Amazon Layoff Will Continue Into 2023 To Reduce Costs, Says CEO Andy Jassy; Read Full Letter Here

Amazon will continue to cut jobs into 2023 as it adjusts to business conditions and the decisions will be shared with impacted employees and organizations early in 2023, said Amazon.com CEO Andy Jassy. The e-commerce giant has started laying off employees across the company amid an “unusual and uncertain macroeconomic environment” and, as per reports, plans to cut 10,000 or 3 per cent of its workforce.

In his first public statement since the company’s cost-reduction plans, the Amazon CEO said, “Leaders across the company are working with their teams and looking at their workforce levels, investments they want to make in the future, and prioritizing what matters most to customers and the long-term health of our businesses… This year’s review is more difficult due to the fact that the economy remains in a challenging spot and we’ve hired rapidly the last several years.”

He added that people were notified in the company’s devices and books business and that some in Amazon’s “People, Experience and Technology” organisation, which includes recruiters and human resources professionals, were offered voluntary buyouts.

Andy Jassy said, “Our annual planning process extends into the new year, which means there will be more role reductions as leaders continue to make adjustments… Those decisions will be shared with impacted employees and organizations early in 2023.”

In the letter to employees, Amazon hardware chief Dave Limp has said, “After a deep set of reviews, we recently decided to consolidate some teams and programs. One of the consequences of these decisions is that some roles will no longer be required. It pains me to have to deliver this news as we know we will lose talented Amazonians from the Devices & Services org as a result.”

News agency Reuters has reported that plans, still in flux, to eliminate around 10,000 roles through reductions in more units would amount to about a 3 per cent cut in Amazon’s roughly 300,000-person corporate workforce. The company has offered voluntary buyouts to some human-resources staff, Reuters has said quoting a source familiar with Amazon’s job-cut plans.

The company has notified regional authorities in California that it would lay off about 260 workers at various facilities that employ data scientists, software engineers and other corporate workers, according to another news agency Associated Press.

The move came days after Mark Zuckerberg, CEO of Facebook’s parent company Meta Platforms, on November 9 said the company has decided to reduce the size of its team by about 13 per cent and let more than 11,000 employees go. Twitter has also laid off 50 per cent of its employees.

HERE’S ANDY JASSY’S FULL LETTER TO EMPLOYEES

Two weeks ago, Beth shared that S-team and I decided to pause new incremental hires in our corporate workforce. Today, I want to share some information about role eliminations. We are in the middle of our annual operating planning review where we look at each of our businesses and make decisions about what we believe we should change. Leaders across the company are working with their teams and looking at their workforce levels, investments they want to make in the future, and prioritizing what matters most to customers and the long-term health of our businesses. This year’s review is more difficult due to the fact that the economy remains in a challenging spot and we’ve hired rapidly the last several years.

Yesterday, we communicated the difficult decision to eliminate a number of positions across our Devices and Books businesses, and also announced a voluntary reduction offer for some employees in our People, Experience, and Technology (PXT) organization. Our annual planning process extends into the new year, which means there will be more role reductions as leaders continue to make adjustments. Those decisions will be shared with impacted employees and organizations early in 2023. We haven’t concluded yet exactly how many other roles will be impacted (we know that there will be reductions in our Stores and PXT organizations), but each leader will communicate to their respective teams when we have the details nailed down. And, as has been the case this week, we will prioritize communicating directly with impacted employees before making broad public or internal announcements.

I’ve been in this role now for about a year and a half, and without a doubt, this is the most difficult decision we’ve made during that time (and, we’ve had to make some very tough calls over the past couple of years, particularly during the heart of the pandemic). It’s not lost on me or any of the leaders who make these decisions that these aren’t just roles we’re eliminating, but rather, people with emotions, ambitions, and responsibilities whose lives will be impacted. We are working to support those who are affected and trying to help them find new roles on teams that have a need; and in cases where that’s not possible, we are offering packages that include a separation payment, transitional health insurance benefits, and external job placement support.

Amazon has weathered uncertainty and difficult economies in the past, and we will continue to do so. We have big opportunities ahead, both in our more established businesses like Stores, Advertising, and AWS, but also in our newer initiatives that we’ve been working on for a number of years and have conviction in pursuing (e.g. Prime Video, Alexa, Kuiper, Zoox, and Healthcare). The key will be to do what Amazon does best – obsess over customers and invent relentlessly on their behalf – and if we do that, we should all be very optimistic about Amazon’s future. I know I am.

I want to thank each of you for your continuing contributions during this challenging time and as we gear up to deliver for customers during the busy shopping season.

Thanks,

Andy.

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