Amazon to lay off thousands of employees amid economic turmoil

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Amazon is planning to lay off around 10,000 employees. The layoff will begin as early as this week, reports the New York Times. The job cuts will be focused on Amazon's devices organization, including Alexa, the company's homegrown digital assistant.

The layoffs, although not officially confirmed, could be the biggest cuts in the history of the e-commerce company. If Amazon lays 10,000 employees off, that would represent around 3 percent of the company's total corporate employees and less than 1 percent of its global work force which is more than 1.5 million.

Amazon is not the first company that is announcing layoffs in the tech world as the US and the rest of the world is heading into an economical turmoil. Last week, Meta announced that it is letting more than 11,000 go. Lyft, Stripe, Snapchat all have laid off workers in recent months. Twitter also halved its employee count, although things haven't been good for those who are still working for the company as well.

Historically, the holiday season would usually mark stability for Amazon. However, this year, the company already froze corporate hiring citing poor economic conditions.

Amazon doubled its workforce during the last two years, funneling into expansion as the pandemic soared the e-commerce business. However, with inflation and people cutting costs, Amazon's growth slowed down to the lowest rate in two decades. This is similar to what forced Meta to reprioritize its hardware business.

Although Amazon has sold thousands of Alexa-enabled products, they offer quite a low margin when it comes to revenue for the company. Instead, Amazon sees these products as a means for customers to get involved with the Amazon-universe, where they are more likely to spend in other ways.

High inflation, slow economic growth and the energy crisis are among the factors responsible for the big tech layoffs.

Source: The New York Times

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