Amazon to lay off 14,000 managers as cost-saving push intensifies
What's the story
Amazon plans to cut 13% of its managerial workforce, amounting to around 14,000 job losses. The cuts are part of a larger plan to save between $2.1 billion and $3.6 billion per year.
The company's global management team will be reduced from 105,770 managers to about 91,936 by early next year.
The cuts come after recent layoffs in Amazon's communications and sustainability divisions as the company attempts to streamline operations and restructure teams for greater efficiency.
Restructuring plan
CEO's strategy to enhance efficiency
CEO Andy Jassy is leading the restructuring push at Amazon, simplifying decision-making and increasing efficiency.
As part of the plan, he plans to increase the ratio of individual contributors to managers by at least 15% by Q1 2025. This would cut down on bureaucracy and speed up operations at the company.
A Morgan Stanley report indicates Amazon's restructuring could eliminate around 13,834 managerial roles by early next year.
Efficiency initiatives
New measures and changes at Amazon
As part of its cost-cutting strategy, Amazon has introduced a "bureaucracy tipline" for employees to report inefficiencies.
Managers have been instructed to increase direct reports, limit senior hires, and review pay structures.
These changes are in line with Amazon's broader efforts to streamline operations and focus on profitability.
The company has previously discontinued initiatives such as its "Try Before You Buy" clothing program and a rapid brick-and-mortar delivery service as part of these cost-saving measures.
Staffing adjustments
Amazon's workforce evolution post-pandemic
During the pandemic, Amazon's workforce ballooned from 798,000 employees in 2019 to over 1.6 million by the end of 2021.
However, as market conditions shifted, the company recalibrated its staffing needs, laying off a total of 27,000 jobs in 2022 and 2023 combined.
The latest round of layoffs is part of an ongoing effort by Amazon to adjust its workforce in line with current business requirements and market conditions.