The world’s largest online shopping company Amazon is once again in the news. The reason is the company’s new retrenchment plan. According to reports, Amazon is preparing to show the exit to about 30 thousand employees.
The company says that this step is being taken to reduce expenses and correct the mistake of excessive recruitment during the pandemic. Even though this number may seem less compared to Amazon’s total of more than 15 lakh employees, 10 percent of the approximately 3.5 lakh employees working in the company’s offices will be affected by this.
Job was increased during the pandemic
Online shopping had increased a lot during the time of Corona. At that time, Amazon had hired more people than necessary to handle orders and deliveries. Now that the situation has become like before, the company is feeling that so many people are not necessary. Therefore now it wants to reduce expenses by reducing the number of employees. Even at the end of 2022, Amazon had laid off 27 thousand people, which was considered the biggest layoff till date. Now the announcement of new retrenchment of 30 thousand is a bigger step than that figure.
In which departments will the jobs go?
New policy of Amazon CEO
Company CEO Andy Jesse now wants to end the bureaucracy running in Amazon. They have recently started a complaint line, where employees can express their problems and weaknesses of the company. So far, around 1,500 complaints have been received, after which changes have been made in more than 450 rules. Jesse believes that to make Amazon faster and more effective, it is necessary to reduce the number of middle managers. This is the reason why now more cuts are being made in mid-level posts.
Artificial intelligence is also a big reason
Another major reason for layoffs this time is Artificial Intelligence (AI). Amazon is now using machines and computer tools to do many tasks that were previously done by humans. Experts say that the company is now making work faster and cheaper with the help of AI. This means that the tasks for which humans were previously required are now being done by AI, hence the need for employees is reducing.
Strictness on employees not coming to office
Some time ago, Amazon had ordered its employees to come to office five days a week. But many people did not follow this rule. Now such employees have been told to leave the company if they cannot come to office daily. According to reports, those who leave the company on their own will not get any severance pay. It is believed that about 15 percent reduction can be made in the HR department alone.
Company’s earnings and current situation
Amazon’s biggest income comes from cloud services (AWS). In the last few months, AWS sales reached approximately $31 billion, an increase of about 17 percent. However, this lead is less than that of companies like Microsoft and Google. It is estimated that AWS sales could reach $32 billion this quarter. The company’s image took a bit of a hit recently due to the 15-hour internet outage that took down several services like Snapchat and Venmo.
