Amazon Global Job Cuts: 16,000 Positions Eliminated via Generative AI Job Replacement

Despite significant profit growth, the wave of layoffs continues. This week, Amazon announced a new round of massive job cuts affecting approximately 16,000 corporate positions. This marks the company’s second major workforce reduction in just three months and its largest adjustment since 2023.

Amazon explicitly stated that the company will increasingly rely on Generative Artificial Intelligence (AI) to replace certain corporate roles while continuing to trim the organizational bloat accumulated during the pandemic.

Global Impact, Canadian Specifics Undisclosed

According to reports from the Associated Press and CTV News, this round of layoffs is a unified global adjustment. However, Amazon has not disclosed the specific number of affected employees by country.

An Amazon Canada spokesperson stated: “The figures provided represent the total number of corporate employees affected globally, but I cannot share specific details for individual countries.” This confirms that while Canadian employees are part of the global framework, the exact scale of the local impact remains undisclosed.

Organizational Restructuring and Flattening Management

Beth Galetti, Amazon’s Senior Vice President, explained the direction of these changes in a blog post on Wednesday. She noted that the company is focused on:

• Reducing management layers

• Increasing accountability

• Eliminating bureaucratic processes

While specific business units were not named, Galetti pointed out that while some teams completed “organizational adjustments” last October, others only finalized the process now. Affected U.S. employees will be given 90 days to find new roles internally; those who do not will receive severance pay, career placement services, and medical benefits.

CEO: Generative AI as a Long-term Staffing Driver

Since taking the helm from founder Jeff Bezos in 2021, CEO Andy Jassy has relentlessly pushed for cost-cutting and organizational efficiency. Last June, Jassy publicly anticipated that the application of Generative AI would reduce Amazon’s corporate headcount over the coming years.

Wednesday’s announcement follows the 27,000 jobs cut in 2023. Notably, these layoffs are not driven by financial distress. In the most recent quarter:

• Profits rose nearly 40% to approximately $21 billion.

• Revenue grew to over $180 billion.

Jassy emphasized that this is a matter of “corporate culture,” noting that rapid growth over several years often leads to excessive management layers and a headcount that surpasses the original operational scale.

The Broader Context: Tech and Logistics Contraction

Amazon’s moves coincide with a significant cooling of the overall job market. U.S. labor data shows only 50,000 new jobs added in December, a stagnation attributed to post-pandemic over-hiring, inflationary pressures, and the potential for AI to replace roles.

The trend is hitting related industries as well:

• UPS announced plans to cut up to 30,000 operational positions this year as package volumes from its largest customer, Amazon, decrease.

• Pinterest announced on Tuesday that it would cut nearly 15% of its workforce to redirect resources toward AI-related sectors.

Following the announcement, Amazon’s shares saw a slight increase during pre-market trading on Wednesday.