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Amazon, Salesforce to cut 26,000 jobs as tech layoff spree continues

Both companies cited economic uncertainty as a key factor in the decision, while Amazon underestimated its number of sackings by almost double

Around 26,000 jobs are set to be cut across both Amazon and Salesforce as the latest round of layoffs continues to shake the global technology industry.

Salesforce announced yesterday that it plans to cut around 10% of its workforce as the software giant fights rising costs and an oversubscribed workforce on the back of intense pandemic hiring.

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At the end of October, Salesforce boasted more than 80,000 staff globally. And since the onset of the coronavirus pandemic, the firm has brought on an additional 17,000 employees to compensate for a heightened demand for services.  

However, CEO Mark Benioff confirmed the layoffs in a letter to staff on Wednesday, citing deteriorating business conditions and over-hiring.  

“As our revenue accelerated through the pandemic, we hired too many people leading into this economic downturn we’re now facing, and I take responsibility for that,” he told staff.  

“The environment remains challenging and our customers are taking a more measured approach to their purchasing decisions,” Benioff added. 

As part of the roll-back, Salesforce said it will also close offices as the firm looks to restructure and ensure an “ongoing commitment to profitable growth”. 

Amazon layoffs cut deep 

Lingering economic uncertainty is also a key factor in the latest round of Amazon layoffs, announced today by chief executive Andy Jassy.  

In a memo to staff, Jassy confirmed that around 18,000 workers globally would be laid off as part of a restructuring process, with some job cuts expected to affect European and UK-based workers. 

Amazon first revealed in November that it planned to eliminate a raft of positions across its Devices and Books division. As part of an audit, the ecommerce giant also offered a voluntary reduction for employees in the People, Experience and Technology (PXT) department.

According to sources speaking to Reuters at the time of the initial November announcement, the planned number of cuts originally stood at 10,000 - nearly half the updated estimates.

Following the review, Jassy confirmed today that additional cuts will be made to the PXT division along with layoffs across “several teams”.  

“Today, I wanted to share the outcome of these further reviews, which is the difficult decision to eliminate additional roles,” he said.  

“Between the reductions we made in November and the ones we’re sharing today, we plan to eliminate just over 18,000 roles. Several teams are impacted; however, the majority of role eliminations are in our Amazon Stores and PXT organisations,” Jassy added.  

Jassy insisted that Amazon has “weathered uncertain and difficult economies in the past”, and that the company is confident it can continue to “pursue long-term opportunities with a stronger cost structure”. 

A year of tech layoffs

This latest round of tech layoffs follows a period of lingering uncertainty in the global technology industry.  

A number of major tech companies, including Meta, have announced job cuts in recent months as economic conditions soured rapidly. In November, Meta revealed it planned to lay off around 11,000 workers.  

In the same month, the tech industry also saw a wave of job cuts spanning several industry verticals. Stripe revealed plans to cut 1,100 staff, around 14% of its total workforce, while Cisco announced more than 4,000 staff would be let go.  

An analysis published this week by Layoffs.fyi revealed that more than 150,000 technology-driven jobs were cut across the whole of 2022.  

Statistics show that layoffs across the year exceeded the total number of job cuts in 2020 and 2021 combined.  

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