New York — Amazon is laying off 16,000 employees in its second major workforce reduction in just three months, as the company adjusts its operations to compete in the rapidly evolving artificial intelligence sector, reports Baltimore Chronicle with reference to CNN. The company stated that the cuts are part of efforts to streamline decision-making and reduce bureaucratic layers.
Beth Galetti, Amazon’s senior vice president of people, emphasized that the company has been working to “strengthen our organization by reducing layers, increasing ownership, and removing bureaucracy.” These layoffs follow the 14,000 corporate employee reductions announced in late October, aligning with CEO Andy Jassy’s vision of keeping Amazon agile, similar to a large startup, as AI reshapes the technology landscape.
Amazon is the second-largest private employer in the United States after Walmart, employing more than 350,000 corporate staff, according to a 2024 survey filed with the US Equal Employment Opportunity Commission. Combined, the two rounds of recent cuts affect roughly 9% of Amazon’s office workforce.
Galetti noted that while layoffs are occurring, they will not establish a “new rhythm” for the company, even though Jassy has suggested that employment levels may continue to be adjusted as AI becomes increasingly central to operations. Amazon will also hire selectively to strengthen areas critical to future growth.
The company faces intense competition from Microsoft, Google, Meta, OpenAI, and other tech firms as it invests in large language models and computing power, with Jassy stressing that the layoffs are intended to improve operational efficiency rather than reduce costs.
Layoffs began on Wednesday, with most affected employees given 90 days to pursue internal roles. Those not retained will receive severance packages and additional benefits. An internal memo informing staff of the layoffs was reportedly sent Tuesday night, prior to the publication of Amazon’s official blog post on Wednesday morning.
In parallel, Amazon announced the closure of its Amazon Fresh and Amazon Go grocery operations, while focusing on the expansion of its Whole Foods stores.
Jassy has repeatedly highlighted the transformative impact of AI on the workforce. In a previous blog post, he explained that the adoption of Generative AI and intelligent agents would reduce the need for certain roles while creating new opportunities in other areas. “Many of these agents have yet to be built, but make no mistake, they’re coming, and coming fast,” Jassy stated.
Despite growing concerns about AI displacing white-collar jobs, a report from Vanguard indicates that positions most exposed to AI are growing faster than before the pandemic, and even faster than other occupations overall. However, some companies have begun eliminating roles where AI can automate tasks or increase efficiency, though there is no evidence yet of widespread workforce disruption.
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