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Amazon set to cut 18,000 jobs globally as it focuses on what matters to customers; UK strike action update

Image: Jordan Stead/Amazon

Amazon says it expects to cut about 18,000 jobs across its global workforce this year as it refocuses on what matters to customers in an uncertain economy.

Amazon chief executive Andy Jassy confirmed the total numbers, which include job losses that were first announced in November, in a statement published overnight. Both Amazon’s US and European businesses are expected to be affected by the job cuts, which will primarily be in Amazon’s stores business and in its people, experience and technology (PXT) division. However, individuals involved will not be notified until the process starts on January 18 – today’s statement was published ahead of plans following a leak. About 10,000 of today’s jobs cuts were announced in November, when they included staff in its devices and books business, as well as voluntary redundancies in its PXT business.

In his statement, Jassy says: “Amazon has weathered uncertain and difficult economies in the past, and we will continue to do so. These changes will help us pursue our long-term opportunities with a stronger cost structure; however, I’m also optimistic that we’ll be inventive, resourceful, and scrappy in this time when we’re not hiring expansively and eliminating some roles. 

“Companies that last a long time go through different phases. They’re not in heavy people expansion mode every year. We often talk about our leadership principle Invent and Simplify in the context of creating new products and features. There will continue to be plenty of this across all of the businesses we’re pursuing. But, we sometimes overlook the importance of the critical invention, problem-solving, and simplification that go into figuring out what matters most to customers (and the business), adjusting where we spend our resources and time, and finding a way to do more for customers at a lower cost (passing on savings to customers in the process).”

The move comes after the retailer expanded quickly in recent years. In the UK, it hired around 10,000 staff in both 2020 and 2021 as it looked to meet strong online demand during the pandemic and in anticipation of economic expansion as lockdowns came to an end. By September 2021, when it held a careers day aimed at hiring 2,500 people in the UK, it employed 55,000 in the market.  

In-store shopping

In recent years Amazon has also opened stores – from bookshops to grocery stores trading variously as Amazon Fresh or Amazon Go – in markets including the UK and US. By March 2022 it had 17 Amazon Fresh shops in the UK, plus an Amazon 4-star shop at Bluewater. But by September 2022 it was pausing its UK expansion of Amazon Fresh stores, amid reports of a ‘lacklustre’ reception for the checkout-less format, featuring Amazon’s Just Walk Out technology, in this country.

A number of technology companies that count retailers among their customers have also reduced headcount in recent months at a time when recessions are predicted in markets around the world in the wake of Russia’s invasion of Ukraine and as inflation hits customer demand.

UK strike update

The date of the first strike involving UK Amazon workers has now been set for January 25. The action will take place at Amazon’s Coventry warehouse following a December ballot organised by the GMB trade union. More than 98% of workers from the Coventry warehouse who voted in a ballot opted to take action to reject a 50p per hour pay offer, according to the GMB, which also said turnout in the ballot accounted for more than 63% of its membership.

Amazon has said that only 20% of the 1,400-strong workforce at Coventry were balloted – and only 12% – or 178 – of the total workforce – of more than 2,000 – voted in favour.

Amanda Gearing, GMB senior organiser, says: “Amazon workers in Coventry are set to make history on 25 January, becoming the first ever Amazon workers in the UK to go on strike. They’ve shown they’re willing to put themselves on the line to fighting for what’s right.

“But people working for one of the most valuable companies in the world shouldn’t have to threaten strike action just to win a wage they can live on. GMB urges Amazon UK bosses to give workers a proper pay rise and avoid industrial action altogether.”

An Amazon spokesperson says: “We appreciate the great work our teams do throughout the year and we’re proud to offer competitive pay which starts at a minimum of between £10.50 and £11.45 per hour, depending on location. This represents a 29% increase in the minimum hourly wage paid to Amazon employees since 2018. Employees are also offered comprehensive benefits that are worth thousands more—including private medical insurance, life assurance, subsidised meals and an employee discount, to name a few.”

Amazon says the action will have no effect on customers. The warehouse where the action is taking place – known internally as BHX4 – provides stock to its UK fulfilment centre rather than shipping orders directly.

Amazon is ranked Elite in RXUK Top500 research.

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