According to a WSJ report, Amazon is cutting jobs across its corporate ranks that could affect 10,000 employees, or 3% of corporate staff. The layoffs have affected employees across a variety of teams, including in Amazon’s Luna cloud-gaming service, Alexa marketing, Alexa AI and Alexa Privacy and the Lab126 innovation arm, according to employees. Amazon CEO also said that more layoffs are coming in early 2023.
Amazon executives have acknowledged that the devices unit has been an area of focus for cuts. According to a note sent to the employees yesterday, many positions have been eliminated and the affected employees need to find a new position within the company or they will be laid off.
It’s hard to tell if the layoffs we observed in the past few weeks are out of necessity or if companies are using this moment to make their operation more efficient as they can blame the cuts on post COVID shocks and the ongoing economic slowdown. But it appears that more layoffs from rich tech companies are coming.
On the other hand, the post COVID shocks are real. It makes forecasting and planning really hard for companies and many of their predictions are probably quite off from reality. Consumers are changing their behavior drastically during and after the COVID lockdowns. First, there’s the e-commerce boom during the lockdown. Once the lockdown is over, there’s a lot of reactionary spending like vacations and dining out. Then inflation comes. Rising consumer prices are affecting people’s spending behavior. I also believe COVID really changes consumers' psyche. Chances are consumers will behave quite differently from the pre-COVID times. And now, we are heading into a recession. Companies have to deal with all these changes and figure out their staffing needs and logistics. It’s totally understandable that companies are becoming more conservative about their growth and expansion plans.
Anecdotally, I bought a lot of random things during COVID but I kind of had a shopping hangover and drastically cut back since this past summer. Frankly, I just have too many purses and necklaces that I need to stop. I wonder if this compulsive shopping behavior also happened to other people. But I am pretty sure I am done with it and I mostly spend money on food and experiences these days.