AI impact: Amazon cutting 30k corporate staff globally; 1,100 in India
Virendra Pandit
New Delhi: Amid ramped up investment in artificial intelligence (AI), global e-commerce behemoth Amazon is set to cut 30,000 corporate office jobs in a belt-tightening move, marking its largest workforce reduction since late 2022, multiple media reports said on Tuesday.
These job-cuts, starting October 28, will include 1,100 positions in India as well.
The scale and speed of the layoff have stirred significant unease. In particular, social-media users reacted sharply.
This reduction will represent nearly 10 percent of the approximately 350,000 office jobs at Amazon, but may not impact, at this stage, the distribution and warehouse workforce that makes up the majority of the company’s more than 1.5 million employees.
Amazon shares ended the formal trading day up on Monday slightly as word of the potential cost-cutting move spread.
This marks Amazon’s biggest workforce reduction since 2022, when it eliminated about 27,000 positions to restructure itself in the post-COVID-19 pandemic era.
The latest move is part of CEO Andy Jassy’s ongoing cost-optimization strategy aimed at streamlining operations and cutting expenses after a period of rapid, pandemic-fuelled expansion. With this move, Amazon is cutting bureaucracy, and making greater use of AI and automation.
Divisions expected to feel the impact of job-cuts include Human Resources (People Experience & Technology), Devices & Services, and Operations, and Amazon Web Services (AWS). Managers in affected teams were briefed earlier this week to prepare for notifying impacted employees via email.
Jassy has lauded the potential of AI to streamline workplace operations, from engaging with customers online to making offices more efficient.
“Our conviction that AI will change every customer experience is starting to play out,” he said during Amazon’s last quarterly earnings call recently.
The tech giant will next report earnings on Thursday, and is among the technology majors under pressure to show the merit of huge investments in AI.
It will also likely be pressed for details about a recent AWS outage. Popular internet services ranging from streaming platforms to messaging services to banking were offline for hours last week because of an outage in Amazon’s crucial cloud network, illustrating the extent to which internet life depends on the tech titan.
The disruption affected streaming platforms, including Amazon’s Prime Video service and Disney+, as well as Perplexity AI, the Fortnite game, Airbnb, Snapchat and Duolingo. Mobile telephone services and messaging apps Signal and WhatsApp were affected in Europe. People also reported problems reaching websites including Amazon’s own e-commerce shop.
Some banks such as Lloyd’s were also impacted, and pointed to AWS cloud computing platform as the source.
Despite the turbulence, India remains a strategic market for the tech company. In June, Amazon India said it would invest Rs. 2,000 crore this year to expand and upgrade its logistics and fulfilment infrastructure to make deliveries faster and more reliable. It is also doubling down on quick commerce through its Amazon Now vertical, a business that demands high capital outlay but promises strong growth potential.
The global layoffs come amid a broader wave of downsizing across the technology industry as firms pivot towards AI-led efficiency and automation.
According to reports, more than 200 technology companies have collectively let go of about 98,000 employees this year. Microsoft has cut 15,000 roles, Meta 600 positions in its AI division, Google 100 roles in its cloud design team, and Intel has reportedly slashed 22,000 jobs.
For Amazon, which has been tightening its corporate structure over the past two years, the latest move reflects Jassy’s push to “remove layers and flatten organisations” to make the company more agile and responsive amid shifting global demand.
