The second round of layoffs comes just two and a half months after Amazon cut about 18,000 positions. It’s the most extensive set of layoffs in the Seattle-based company’s history, although just a fraction of its 1.5 million-person global workforce.
Jassy claimed it was a difficult decision, but said it was one that would be best for the company long-term. He explained that in previous years, the company added positions based on its business and what was happening with the economy as a whole. The company’s workforce doubled during the pandemic during a hiring surge across almost the entire tech sector.
This time around, the job cuts will hit profitable areas for the company including its cloud computing unit AWS and its burgeoning advertising business. Twitch, the gaming platform Amazon owns, will also see some layoffs as well as Amazon’s PXT organizations, which handle human resources and other functions.
Previous layoffs mostly impacted the company’s brick-and-mortar stores, which included Amazon Fresh and Amazon Go, as well as its PXT organizations, which handle human resources and other functions.
He said the reason for the additional layoffs was that not all teams were done with their analyses in the fall, and they wanted to give those assessments the appropriate diligence before making decisions to cut.
“We will, of course, support those we have to let go, and will provide packages that include a separation payment, transitional health insurance benefits, and external job placement support,” Jassy wrote.
According to The Hollywood Reporter, Amazon’s most recent earnings report revealed the company beat Wall Street expectations, despite its earnings being lower than what it made the year before.
Amazon has also been cutting back on other areas. Earlier this month, the company said 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.
The company ramped up hiring during the pandemic to meet the demand from homebound Americans who were increasingly buying things online to keep themselves safe from the virus. Its workforce – which encompasses warehouse workers as well as corporate roles – doubled to more than 1.6 million people in about two years.
But demand slowed as the worst of the pandemic eased – and the company began pausing or canceling its warehouse expansion plans last year to make sure it doesn’t bleed unnecessary money.
As fears over a potential recession started growing, it also began making other trims in areas. In the past few months, it has shut down a subsidiary that’s been selling fabrics for nearly 30 years and shuttered its hybrid virtual, in-home care service Amazon Care among other cost-cutting moves.
The Associated Press contributed to this report.