Amazon is cutting 16,000 jobs in its latest corporate overhaul, adding to 14,000 roles axed last October and fuelling concerns over tech sector redundancies.
The combined action affects nearly 10 per cent of office staff. Key units hit include Amazon Web Services, retail, Prime Video, and human resources. Broader aims target up to 30,000 redundancies for greater nimbleness.
This pattern echoes decades of tech sector upheaval. In 1993, IBM dismissed 50,000 workers as chip advances and personal computers eroded demand for its mainframes. The firm pivoted to software and services.
Microsoft followed suit in 2014, with new chief executive Satya Nadella axing 18,000 jobs after acquiring Nokia’s mobile unit. Priorities turned to cloud and mobiles. Cisco shed thousands in the 2010s, redirecting from hardware to cybersecurity, data centres, and cloud tools as computing evolved.
Amazon insists artificial intelligence does not drive most of these cuts. Still, the technology influences the landscape. Rivals including Microsoft, Meta, and Verizon made their own reductions last year.
“The most transformative technology we’ve seen since the internet,” said Beth Galetti, Amazon’s senior vice president of people experience and technology, at the October announcement. The firm wants “fewer layers” to “move as quickly as possible.”
Her recent memo outlines plans to “strengthen” the organisation by “reducing layers, increasing ownership, and removing bureaucracy.” Chief executive Andy Jassy attributes the push to trimming excess management from past growth.
“Amazon cannot easily retrain a workforce built for manual logistics or legacy retail systems into one that builds generative AI agents,” said Zeki Pagda, assistant professor at Rutgers Business School.
The company remains financially robust, with $180.2 billion in net sales for last September’s quarter and a $2.5 trillion market capitalisation.