Amazon Plans Major Job Cuts Amid AI Transformation

Amazon is preparing to reduce its corporate workforce by as many as 30,000 jobs, a move that reflects the company’s strategic shift towards artificial intelligence (AI) and cost management. This decision marks a significant reversal of the hiring practices that characterized the pandemic’s peak, during which the company expanded rapidly to meet changing consumer demands.

According to reports from Reuters and the Wall Street Journal, the impending job cuts will impact various divisions globally, including human resources, operations, devices and services, as well as Amazon Web Services (AWS). AWS is a leader in cloud computing, providing essential services such as storage, databases, machine learning, and security tools. Recent disruptions to AWS have led to outages affecting numerous internet services and several financial institutions worldwide.

The cuts are said to represent nearly a tenth of Amazon’s approximate 350,000 corporate workforce. Amazon employs over 1.5 million individuals globally, the majority of whom work in warehouse roles. In the UK alone, the company has around 75,000 employees, according to reports.

Strategic Shift Towards AI

The anticipated layoffs are part of a broader effort to streamline operations and reduce costs. Insiders have indicated that this decision follows a significant recruitment drive during the pandemic, which saw a permanent shift in consumer behavior towards online shopping.

In June 2023, CEO Andy Jassy warned employees about the potential for job losses as the company increasingly integrates generative AI and AI agents into its operations. In a memo, he stated, “As we roll out more Generative AI and agents, it should change the way our work is done.” He indicated that the implementation of these technologies would necessitate fewer personnel in some roles while creating demand for different types of jobs.

The company has also been trimming various roles across its operations in recent years. Last month, Amazon announced the closure of all its Amazon Fresh grocery stores in the UK, a decision that put 250 jobs at risk.

Looking Ahead

As Amazon navigates this transformative phase, it remains unclear how many employees will be directly affected. The company has yet to respond to requests for comment on the impending job cuts.

The changes at Amazon reflect a significant trend in the tech industry, where advancements in AI are reshaping job roles and organizational structures. As companies adapt to these technological innovations, the workforce landscape is likely to evolve, prompting both challenges and opportunities for employees in the sector.