Amazon's AI Goals Could Hit Workforce As Broader Tech Sector Layoffs Recede

Author: Surbhi Jain | April 12, 2024 12:51pm

The tech industry continues to experience layoffs, and Amazon.com Inc (NASDAQ:AMZN) is a significant player in shaping these trends.

What Happened: Amazon CEO Andy Jassy recently expressed a commitment to cost-cutting while investing in artificial intelligence (AI).

The declaration hints at the possibility of further job cuts, while resources are devoted to automation.

The broader tech sector has witnessed a decline in layoffs compared to previous years. According to data available on Layoff.fyi, so far, 249 tech companies initiated layoffs, resulting in the displacement of 59,285 employees.

This marks a notable decrease from 2023, where 1,192 companies laid off 263,180 employees, indicating a downward trend in layoffs.

Quarterly Trends and Post-COVID Impact

On a quarterly basis in 2024, layoffs have been steadily decreasing, with January, February, March, and April witnessing reductions in both the number of companies initiating layoffs and the total employees affected.

This trend contrasts with first-quarter 2023, which saw the highest layoffs post-COVID, with 167,574 employees laid off across 585 companies.

Amazon’s Share in Total Tech Layoffs

Amazon’s role in the tech sector layoffs is significant, particularly considering its share in total layoffs and its influence as a major player in the retail industry within the tech sector.

Between November 2022 and March 2023, Amazon’s layoffs totaled 27,000.

In comparison, the retail industry within the tech sector (to which Amazon belongs) saw layoffs of 21,214 in 2022, 32,133 in 2023, and 7,470 in 2024.

This highlights Amazon’s substantial contribution to overall layoffs within the tech sector, underscoring its impact on industry dynamics.

Industry Insights

Delving into specific industries within the tech sector sheds light on where layoffs are concentrated.

• In 2022, the retail industry witnessed the maximum layoffs, followed by the consumer and transportation sectors.
• In 2023, retail, consumer, and hardware were the top three industries within the tech sector experiencing layoffs.
• Interestingly, in 2024, the hardware industry leads in layoffs so far, followed by retail and consumer sectors.

As the tech industry continues to navigate economic uncertainties and market shifts, analyzing layoff trends provides valuable insights into the sector’s resilience and challenges.

While 2024 has seen a decline in layoffs overall, specific industries and companies like Amazon continue to shape the narrative of layoffs within the tech sector, emphasizing the importance of monitoring these trends for investors, industry analysts, and policymakers alike.

Read Next: Amazon Layoff Spree To Continue Despite Record Profits: ‘Very Careful On Our Investments,’ Says CFO

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Posted In: AMZN