News & Analysis

Big Tech Layoff Tragedy Continues

Amazon announces yet another round of layoffs; This one is tough to explain as many are from their most profitable AWS business

Click on, a website that tracks the number of people who lost their jobs in the United States since Covid-19 times, and the numbers are quite gut-wrenching. According to the website, a total of 148,165 people have been let go off by 503 tech companies thus far during 2023 and the worst part is that we aren’t yet sure if the worst is behind us. 

In case you have already clicked on the above link, try browsing through each month’s data separately and these numbers stare back. In January 2023 alone, 84,714 people got laid off with the numbers for February (36,491) suggesting that the worst was possibly over. However, just the dust seemed to be settling, Amazon has announced another 9,000 jobs being lost. 

Amazon fires another salvo

In a memo shared by CEO Andy Jassy last evening, the company said 9,000 jobs would cease to exist and will impact those in the AWS cloud unit, Twitch gaming division, advertising and PXT (experience and technology solutions) arm. 

The latest update comes barely a couple of months after Amazon let go of 18,000 people in what was one of the largest in the United States in recent times. In that round, most of the people who lost their jobs came from PXT and Amazon Stores. However, till date we are not sure if this number includes the 10,000 people they reportedly let go off late last November. 

Jassy’s note said: “Some may ask why we didn’t announce these role reductions with the ones we announced a couple months ago. The short answer is that not all of the teams were done with their analyses in the late fall; and rather than rush through these assessments without the appropriate diligence, we chose to share these decisions as we’ve made them so people had the information as soon as possible. The same is true for this note as the impacted teams are not yet finished making final decisions on precisely which roles will be impacted. Once those decisions have been made (our goal is to have this complete by mid to late April), we will communicate with the impacted employees (or where applicable in Europe, with employee representative bodies).”

Meta to lose 10,000 as well

This report comes on the back of news that Meta founder Mark Zuckerberg revealed that another round of layoffs were on the anvil – this time 10,000 people are likely to face the music. “Here’s the timeline you should expect: over the next couple of months, org leaders will announce restructuring plans focused on flattening our orgs, canceling lower priority projects, and reducing our hiring rates,” Zuckerberg said in a message to employees, which was also posted to the technology company’s blog.

What is intriguing about the Amazon announcement is that this time the company has targeted its cash cow AWS. Though the web services business has been robust, its growth journey in recent times hasn’t been all that sharp compared to previous years. So, it looks like the company wants to cut costs by blaming it on the economic downturn and have a few extra dollars to show during the results season. 

If one were to draw a context around this escapade, consider that Microsoft is gaining ground over AWS with its Azure cloud division. The company had announced a round of layoffs in January of which some 150 were working on Azure. So, this is the first time that Amazon has acted tough on its cash cow.

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