Amazon Reportedly Plans To Lay Off As Many As 10k Employees
Despite another holiday season looming on the horizon, the Amazon workforce will drop by around 10,000 with layoffs starting this week, according to reports from The New York Times and The Wall Street Journal. The news comes on the heels of another WSJ report that claims Amazon has hemorrhaged $5 billion annually in operating losses in recent years, and a Bloomberg report that reveals Amazon set an infamous record as the first public company to tank in market value by $1 trillion.
Historically, Amazon has always temporarily beefed up its workforce for the holiday season, and still plans to add 150,000 employees to its payroll this year (via CNBC). The rumored layoffs target the tech giant's human resources, devices, and retail logistics departments, the sources claim. The cuts are reportedly part of an effort to parry back the financial hurts of multiple less-than-profitable sectors within the tech giant's biome, including Alexa and other devices, a flopped attempt at providing primary and urgent care, and robot-driven home delivery.
Amazon rode into the present day on an all-time profit high during the pandemic. The company's workforce had doubled over two years, sparking ambitious plans for expansion and new R&D endeavors. Since September, though, Amazon has frozen the filling of thousands of open roles across the corporate, retail, and specialty sectors, while CNBC reports that Amazon shares have slipped by around 2.5% today, November 14.
Forecasts of low American holiday spending compound struggles for Amazon
The economic wound caused by the pandemic, supply chain woes, and inflation is still unhealed. Consumers who can afford the most shopping in the 2022 holiday season aren't doing it, says Forbes, and are opting to use their cash for trips and travel instead. For the more modest earners, though, the amount that the average consumer is expected to spend — $833 on average, says The National Retail Federation — are more likely to redirect that money to everyday essentials as inflation bears down on the middle class.
A Deloitte study predicts that the volume of stuff purchased for this year's gift-giving season will pitch by around 5% as adults with disposable income instead choose experiences, entertainment, restaurants, concert tickets, and travel. Two-thirds of the Deloitte respondents that are counting coins this year are doing so because of higher costs. Amazon CFO Brian Olsavsky stated to shareholders last month that there is some trepidation surrounding future consumer spending habits, according to The New York Times. The company is "ready for a variety of outcomes," Olsavsky reportedly said. If current predictions are true, those outcomes are likely to be exactly what Amazon doesn't need: a disinterest in e-commerce.