Amazon founder Jeff Bezos told CNN this week that he intends to give away the bulk of his $124 billion net worth during his lifetime. While the billionaire prepares to give away a portion of his fortune, his company is preparing to give out pink slips to approximately 10,000 employees.
Clear-cutting at Amazon
Anonymous sources told the New York Times that Amazon will begin firing around 10,000 people in corporate and technology jobs starting this week. This would constitute the biggest single round of layoffs in the company’s history and account for nearly 3% of its corporate employees and just under 1% of its 1.5 million-strong global workforce.
This purge comes before the Christmas season and on the tails of Amazon’s most profitable period, when pandemic shoppers relied heavily on the online marketplace.
During the pandemic (i.e., between late 2019 and late 2021), Amazon hired over 800,000 employees to keep up with online orders.
This year, the online retailer fired roughly 80,000 workers between April and September.
In the first week of November, Amazon announced it was instituting a hiring freeze with regard to corporate jobs.
According to the Wall Street Journal, Amazon chief executive Andy Jassy is leading a cost-cutting review and looking to cut back elements of the business that haven’t been profitable.
Alexa, for instance, has more than 10,000 employees, some of whom may soon be exited. After all, Alexa is part of Amazon’s devices unit, which has in recent years reportedly posted an operating loss of over $5 billion per year.
The New York Times indicated that among the initiatives that Amazon will likely kill or shrink are Amazon Care, Scout, and Fabric.com.
People “familiar with the matter” told the Wall Street Journal that the company has informed persons in unprofitable divisions they should look for jobs elsewhere in the company because their teams were finished.
‘Batten down the hatches’
The Seattle-based company’s stock was down 43% this year as of Nov. 10.
Last week, Bloomberg reported that Amazon became the world’s first public company to lose a trillion dollars in market value, dropping from its record close of $1.88 trillion in July 2021 all the way down to $879 billion. This loss was the result of “rising inflation, tightening monetary policies and disappointing earnings updates,” which triggered a historic stock sell-off.
By Friday, the company’s market cap had climbed back up to around $1.02 trillion.
Some have suggested that the announcement of layoffs at a time when Amazon may have otherwise been preparing for Cyber Monday is a good indication that a recession is imminent.
Bezos previously signaled that he expected a recession, tweeting on Oct. 18 that “the probabilities in this economy tell you to batten down the hatches.”
— The Socialist Party (@The Socialist Party)
The Kobeissi Letter, which provides commentary on global capital markets, tweeted a stark rundown of significant layoffs that have taken place in recent days and weeks:
— The Kobeissi Letter (@The Kobeissi Letter)