Amazon is to shed more than 18,000 workers globally due to an “uncertain and difficult” economic situation.
The e-commerce giant did not share where the job cuts would take place, but it is understood many will be across Europe.
In an update yesterday, Amazon CEO Andy Jassy said the company had “hired rapidly over the last several years” but now needed to cut costs.
“These changes will help us pursue our long-term opportunities with a stronger cost structure,” Jassy said. “However, I’m also optimistic that we’ll be inventive, resourceful and scrappy in this time when we’re not hiring expansively and eliminating some roles.
“Companies that last a long time go through different phases. They’re not in heavy people expansion mode every year,” he added.
Affected employees would be informed on 18 January, the company said.
Amazon mounted a major recruitment drive through the pandemic, when e-commerce sales soared.
As recently as July last year, the company said it was to create 4,000 new permanent roles in the UK, taking its permanent workforce to 75,000.
The new roles would be spread across the country, including those in fulfilment centres set to open in Wakefield and Knowsley.
However, as pandemic online shopping habits have faded, the company has been left with excess warehouse space and staff.
In November, Amazon announced job cuts in its devices and books businesses. In yesterday’s update, Jassy said the majority of the latest cuts would be across its stores and People, Experience, and Technology (PXT) organisation.
Jassy said he was “deeply aware that these role eliminations are difficult for people, and we don’t take these decisions lightly or underestimate how much they might affect the lives of those who are impacted”.
Former Amazon executive Brittain Ladd said he believed the cuts would go much further over the course of the year, estimating 100,000 store associates, corporate staff and fulfilment centre workers would depart.
“Amazon simply hired too many people as they misjudged what would happen after the pandemic,” Ladd said. “I have tremendous respect for the economists who work for Amazon, but I’m incredulous that they failed to understand that when the pandemic ended, consumers would revert back to their behaviours and online sales would fall.”
“I can’t stress this point enough: by doubling the size of the company during the pandemic, Amazon may have jeopardised the future of the company,” Ladd added.
The news comes as Amazon workers in the company’s Coventry warehouse have announced an initial strike date. The “first ever Amazon strike in the UK” is set to take place on 25 January, with further dates to be announced by organising union GMB in the coming weeks.
Hundreds of the centre’s workers voted to walk out in anger over the company’s 50 pence per hour pay rise offer. A December ballot saw more than 98% of workers vote to strike.
“They’ve shown they’re willing to put themselves on the line to fight for what’s right,” said Amanda Gearing, GMB senior organiser.
“But people working for one of the most valuable companies in the world shouldn’t have to threaten strike action just to win a wage they can live on,” she added.
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