Artificial Intelligence Causes Amazon to Lay Off 16,000 Employees

SadaNews - Amazon has announced its intention to terminate the services of around 16,000 employees working in administrative offices, intensifying its efforts to simplify bureaucracy amid rising competition in the field of artificial intelligence.

Beth Galetti, Amazon's Senior Vice President for Employee Experience and Technology, stated in a blog post published on Wednesday that the company will give employees in the United States a 90-day grace period to seek alternative job opportunities within the company, in addition to severance pay and other transitional support.

Artificial Intelligence Competes for Jobs at Amazon

Galetti added, "We are working to enhance our organization's efficiency by reducing management layers, expanding the scope of responsibilities, and eliminating bureaucratic hurdles," indicating that the repeated announcement of massive layoffs "is not part of our plan," and that the company will continue to "make necessary adjustments as needed."

These cutbacks increase the total number of jobs that Amazon has announced it would eliminate to about 30,000 within three months, following an initial wave in October. CEO Andy Jassy has repeatedly affirmed his intention to reduce management layers that have begun to raise concerns among executives after a hiring boom during the pandemic.

Last year, Jassy warned employees that the expanded use of artificial intelligence would lead to a reduction in the workforce as Amazon's automation of its operations accelerates.

The number of employees at Amazon was approximately 1.57 million as of September 30, with most working in warehouses, while the administrative sector encompasses around 350,000 employees, meaning that the recent cutbacks equal about 4.6% of this workforce.

Widespread Layoffs in Technology Companies

Employees were informed of the layoff decisions early Wednesday, although some had received prior hints that these decisions were imminent. Senior Vice President at Amazon, Colleen Aubrey, had scheduled a meeting titled "Project Dawn" earlier, which included a reference to "affected colleagues" in the United States, Canada, and Costa Rica.

The email quickly spread, stating that "such changes are difficult for everyone," on internal communication platforms and social media sites like Reddit, where employees were discussing their predictions regarding the anticipated wave of layoffs.

Several technology companies have begun the year with announcements of wide-scale layoffs. Meta Platforms announced its intention to eliminate more than a thousand jobs in its "Reality Labs" division to redirect resources towards AI-powered wearable devices and phone features.

Pinterest announced on Tuesday that it plans to reduce "less than 15%" of its workforce and downsize its office spaces, in a similar move to redirect resources toward artificial intelligence. Autodesk also stated that it would eliminate about a thousand jobs.

ASML Holding, one of the main beneficiaries of the artificial intelligence boom as the sole supplier of the advanced equipment needed for producing NVIDIA graphics processing unit chips, announced its plan to cut around 1,700 jobs to reduce complexity and enhance operational flexibility, despite recording record orders during the fourth quarter.