Amazon is set to cut around 14,000 corporate jobs as the e-commerce powerhouse shifts gears, doubling down on spending for artificial intelligence while trimming expenses in other areas.
Teams and individuals affected by these cuts will be informed on Tuesday. Most employees will have 90 days to search for new roles within the company, according to Beth Galetti, Senior Vice President of People Experience and Technology at Amazon, who shared this in a letter to workers on Tuesday. For those who can’t snag a new position or choose not to look, they’ll receive transitional support, which includes severance pay, outplacement services, and health insurance benefits.
With about 350,000 corporate employees and a total workforce nearing 1.56 million, the layoffs announced Tuesday represent a roughly 4% reduction in the corporate staff.
Back in June, CEO Andy Jassy, who’s been actively seeking to cut costs since taking the helm in 2021, noted that he expected generative AI to further shrink Amazon’s corporate workforce in the coming years.
Jassy pointed out that Amazon has over 1,000 generative AI services and applications in the works, although he mentioned that’s just a “small fraction” of what they aim to develop.
Amazon is also gearing up to invest $10 billion to build a new campus in North Carolina, focusing on expanding its cloud computing and AI infrastructure.
Since the start of 2024, Amazon has committed around $10 billion each to data center projects in Mississippi, Indiana, Ohio, and North Carolina, building its infrastructure to keep pace with other tech giants making strides in AI. They’re in a competitive race with companies like OpenAI, Google, Microsoft, and Meta. During a conference call with industry analysts in May, Jassy emphasized that the potential for growth in Amazon’s AWS business is enormous.