It is true that Amazon had plans to reduce the size of its workforce. However, the number of job cuts may be more than what the e-commerce company had originally planned.
According to the Wall Street Journal, 17,000 jobs may be axed, affecting employees in various divisions including human resources, Alexa, as well as retail.
While layoffs at Amazon had begun last year, in November itself, the numbers were expected to be around 10,000. Now, it seems rising inflation and less than expected pace of growth are forcing it to cut more jobs and reduce costs, just as many organisations across the world are doing.
Seattle-based Amazon had increased pay packages last year to attract quality talent.
With fuel prices rising, the e-commerce giant ended up spending a lot more on shipping. In fact, it reportedly spent about $19.9 billion in the third quarter of 2022, on shipping, which is 10 per cent more than what it used to.
Amazon recently obtained a loan of about $8 billion from various banks, to meet corporate needs and fulfil working capital needs. This is one of the measures taken by the Company in preparation for the uncertainties and difficult times ahead.
The Company has also stopped corporate hiring in its retail business, closed down its telehealth service, along with various call centres in the US, and has also reportedly cut budgets for its delivery-robot project.
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