Over the last 6 months, Amazon has cut about 100,000 employees globally. This is due to the dramatic economic slowdown since 2020 and 2021.
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The company is cutting thousands of employees in a single quarter. It’s a shift that reflects the growing trend of cutting unnecessary expenditures and the blame for it can be partly attributed to Amazon’s recent revenue boost and profit margins for the third quarter; even though Amazon’s profit was down in the second quarter. They still lost $2 billion in revenue from their year-ago period.
The more employees lose their jobs, the better it looks to shareholders. Surely there will be more layoffs in future quarters. Over 30,000 people have lost their jobs in tech so far this year, and the unemployment rates have also risen.
Despite its impact, recent stimulus programs such as the 2020-2021 Covid Pandemic Lockdowns have had a global economic impact for tech companies. They also created an artificial boost for Amazon at the time, but much of it has circulated out of people's and has threatened existing economic stability. Demand for delivery services is falling due to the rising cost of basic necessities. In 2022, a major economic situation will happen that will lead to dramatic income decline.
This news comes as many companies have come forward to share their restructuring plans - Alphabet Inc. is putting a freeze on hiring and Apple's cutting down on the number it hires per year, for example. Coinbase and Microsoft are also taking similar measures, with the latter announcing that it would be terminating 18% of its staff.
It was just reported that Netflix fired over 500 employees, including contractor layoffs. Peloton has so far fired 2800 workers this year.
Online brokerage Robinhood cut 9% of its workforce in April. Twitter cut 30% of its talent acquisition team last month but didn't provide a specific number of layoffs. It's looking like that list is going to keep getting bigger and bigger for sure.
The economic downturn is happening very quickly, and it's clear that the tech industry is dependent on consumers with a lot of disposable income. A year ago, it wasn't as expensive to get computers or technology, but now smartphones are $1k and computers start at $1k+.
When the economy is bad, the first industry to feel the pressure are tech companies. When most tech companies offer little 'necessities' in terms of providing content which leads to a fairly unstable financial environment, things can get tight.