Amazon Begins Job Cuts In Cloud Computing, HR Divisions As Part Of Latest Layoff Round

Amazon has started eliminating some roles in its cloud computing and human resources units, a new report revealed. The layoffs are part of the reductions that CEO Andy Jassy previously said would affect around 9,000 employees.

“Given this rapid growth, as well as the overall business and macroeconomic climate, it is critical that we focus on identifying and putting our resources behind our top priorities,” Amazon Web Services (AWS) CEO Adam Selipsky said Wednesday, according to a memo to employees that was obtained by CNBC.

Cloud computing unit AWS is one of the e-commerce giant’s biggest and most profitable departments. The division already saw job cuts when Jassy announced thousands of reductions across the company last month.

Wednesday’s workforce reductions are expected to hit AWS’ professional services arm.

In its fourth-quarter earnings report, Amazon said AWS sales increased by 20% year-over-year and revenue rose by about 2% from the end of 2021 to the end of 2022, Gizmodo reported. The unit withstood the tech downturn in the past year that saw many tech companies, Amazon included, cutting thousands of jobs in cloud computing departments.

At the company’s People Experience and Technology Solutions (PXT Solutions) unit, human resources head Beth Galetti told staffers that the layoff “decisions are not taken lightly,” the CNBC report said.

Galetti said Jassy’s announcement about leaders deciding which investments to focus on in the future affected their plans and “we have made the difficult decision to eliminate additional roles within the PXT organization.”

The executive added workers in the U.S., Canada and Costa Rica have been informed about their employment status.

It is unclear totally how many employees in Amazon’s cloud computing and HR teams have been affected.

While some AWS teams were already affected in the March layoffs, including recruiters and some from the “Just Walk Out” physical stores, the earlier layoff rounds hit the HR department the most, followed by retail and devices teams, according to Bloomberg.

In January, Jassy said the company was cutting 18,000 jobs, adding the majority of the cuts would be in PXT and Amazon Stores.

The CEO last month announced the company was looking to let go of another 9,000 employees and that most of them would be from PXT, AWS, Advertising and Twitch divisions.

“Given the uncertain economy in which we reside, and the uncertainty that exists in the near future, we have chosen to be more streamlined in our costs and headcount,” Jassy said in a message to employees.

Amazon has also decided to shut down its health division, Halo.

“We have made the difficult decision to wind down the Halo program, which will result in role reductions,” said Melissa Cha, Amazon’s VP of smart and home health, in the email obtained by The Verge.

Cha said Halo faced “significant headwinds” in recent months, including “an increasingly crowded segment.”

Amazon has reportedly pulled the Halo Band, Rise and View wearables from its website. The wearables are still available in some third-party retailer stores.

News of the latest layoffs round came a day after reports said employees at Amazon Studios and Prime Video were speculating the layoffs would affect them next.

It was reported that top executives from the two entertainment units were recently called to a meeting to discuss layoffs. Some workers were also speculating that job cuts would also hit MGM, the studio that Amazon acquired last year.

Amazon is just one of more than 600 companies that laid off employees this year. The company joins other big tech giants like Meta, Google, Microsoft and even once-resilient Apple in reducing their workforces.

More than 184,000 tech jobs were eliminated in the first four months of 2023, according to data from layoff tracker layoffs.fyi. Amazon has announced roughly 27,000 layoffs since the tech downturn that started last year.