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Amazon lays off thousands of corporate workers as it spends big on AI
Two Amazon employees talk at one of the entrances to the company's East Coast headquarters in Virginia.
(
Andrew Caballero-Reynolds
/
AFP via Getty Images
)
Amazon is laying off thousands of corporate workers in an effort to slim down while it spends big on the AI race.
In a note on Tuesday, Amazon human-resources executive Beth Galetti said the tech giant would cut about 14,000 corporate jobs, or about 4% of its workforce. She cited a goal of "reducing bureaucracy, removing layers, and shifting resources to ensure we're investing in our biggest bets and what matters most to our customers' current and future needs."
Amazon has faced intense pressure from investors to tighten its finances. The company had ballooned its workforce, including in corporate jobs, during the pandemic. And Amazon in July reported disappointing gains in its AI business; it's a dominant cloud-computing giant, but its growth in AI is lagging behind Microsoft and other rivals.
Amazon will deliver its latest financial report on Thursday. Last week, its AWS cloud service suffered one of the worst outages in its history, disrupting the work of numerous popular websites and apps, including Venmo, Reddit, Roblox and Duolingo.
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Amazon CEO Andy Jassy in June wrote to employees about his thoughts on generative AI, saying: "We will need fewer people doing some of the jobs that are being done today, and more people doing other types of jobs. It's hard to know exactly where this nets out over time, but in the next few years, we expect that this will reduce our total corporate workforce as we get efficiency gains from using AI extensively across the company."
News reports, citing company insiders, previously suggested layoffs could affect as many as 30,000 corporate jobs across human resources, cloud computing and many other divisions.
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Amazon's corporate layoffs come on the heels of nearly 2,000 corporate job cuts at Starbucks as part of the coffee-chain's turnaround plan, prompted by declining sales. Last week, Target also said it would cut 1,800 jobs from its corporate headcount, as it tries to right the ship with sales down or flat for almost three years.
Editor's note: Amazon is among NPR's recent financial supporters and pays to distribute some NPR content.
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