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Jan 28 (Reuters) – Amazon said on Wednesday it would cut 16,000 jobs globally, making its second major job cuts in three months as it seeks to restructure after a pandemic-era hiring glut and ramp up adoption of artificial intelligence tools.
Reuters first reported last week that Amazon was planning a second round of job cuts as part of a broader goal to cut about 30,000 corporate roles, with the latest round of job cuts expected to affect employees in Amazon Web Services, retail, Prime Video and human resources.
Amazon cut 14,000 white-collar jobs in late October, with CEO Andy Jassy emphasizing the need to eliminate excessive bureaucracy by reducing operational levels and the number of managers.
“Some may wonder if this is the beginning of a new rhythm of announcing significant cuts every few months. That is not our plan,” said Beth Galetti, Amazon’s senior vice president of people experience and technology.
The rise of AI adoption
The layoffs highlight how artificial intelligence is changing the dynamics of companies’ workforces. Significant improvements in AI assistants are helping businesses quickly and accurately perform tasks ranging from routine administrative tasks to complex coding problems, fueling their adoption.
Jassy said last summer that companies would lose jobs as the increased use of AI tools automates tasks.
Earlier this month, executives at the World Economic Forum’s annual meeting said jobs would be eliminated but new ones would be created, and two of them told Reuters that companies planning to cut jobs anyway would use AI as an excuse.
Together, the 30,000 jobs represent a small portion of Amazon’s 1.58 million employees, but nearly 10% of the company’s total workforce. The majority of Amazon employees work in fulfillment centers and warehouses.
Tech giants including Amazon, Facebook parent company Meta Platforms META.O and Microsoft MSFT.O have ramped up hiring during the coronavirus pandemic’s surge in demand and have recently been restructuring their workforces.
Amazon is also investing in warehouse robotics to speed up packaging and shipping for its e-commerce division, reduce reliance on personnel, and lower costs.
The company is scheduled to release quarterly results next week.
(Reporting by Devotee Sophia and Zaheer Kachwala in Bengaluru; Editing by Arun Koyur)
