Amazon Facing More Inflation Woes

Amazon just released information about employee dismissals so that the giant e-commerce store can reduce its costs amid continued inflation worries. 

Andy Jassy, the man who succeeded Amazon founder Jeff Bezos as chief executive two years ago, said that the layoffs would be concentrated in retail and human resources divisions. This move follows a recent decision for dismissals in the company’s devices and books units at the end of 2022. 

The total number of employees dismissed is 18,000.

“Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so,” Jassy wrote. “These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles.”

Amazon Senior Vice President of People Experience and Technology, Beth Galetti, informed employees last year that the company would institute a “freeze” on incremental hires in the corporate workforce.

“We anticipate keeping this pause in place for the next few months, and will continue to monitor what we’re seeing in the economy and the business to adjust as we think makes sense,” she said last year.

Employees impacted by the layoffs will get “a separation payment, transitional health insurance benefits, and external job placement support,” according to Jassy. 

Amazon share prices fell 1% on Thursday even though the announcement had previously been leaked by an employee and published in a report for the Wall Street Journal.

Amazon had a net income of $2.9 billion in the third quarter of 2022, marking a decline from $3.2 billion one year earlier. And share prices have decreased by nearly 49% over the past year.

Last year was one of the worst in stock market history. The S&P 500 index fell nearly 20%, while the technology-heavy NASDAQ fell more than 33%.