Amazon is reportedly preparing to initiate a new round of corporate job cuts as early as next Tuesday, marking a second wave of redundancies within months. This move coincides with a stark warning from the head of the International Monetary Fund (IMF) that artificial intelligence is poised to hit the global labour market with the force of a "tsunami".
IMF Chief's Dire Warning on AI's Labour Impact
Speaking at the World Economic Forum in Davos, IMF managing director Kristalina Georgieva outlined research indicating that artificial intelligence will significantly affect a vast swathe of employment. The findings suggest that approximately 60 per cent of jobs in advanced economies will be impacted by AI in the coming years, with a global figure of 40 per cent.
Georgieva explained that roles will be fundamentally altered, being "enhanced, eliminated or transformed" by the technology. While workers whose positions are enhanced by AI may see increased earnings and greater local economic spending, the IMF chief highlighted that entry-level and junior roles face the highest risk of displacement.
Amazon's Strategic Overhaul and AI Focus
Against this backdrop of technological disruption, Amazon is moving forward with substantial workforce reductions. The upcoming cuts are expected to mirror the scale of the 14,000 white-collar positions eliminated by the tech giant in October last year. This forms part of a broader corporate strategy aiming to trim around 30,000 roles from its corporate workforce.
Reports indicate that the new redundancies could commence as soon as Tuesday, with potential impacts across several key divisions including Amazon Web Services (AWS), retail operations, Prime Video, and the human resources department. The precise scope and final numbers remain uncertain, with Amazon declining to comment on the developments.
Corporate Culture Versus Technological Drivers
The previous round of layoffs in October was initially linked by the company to the rapid ascent of AI technology, described internally as the most transformative development since the internet. However, Amazon chief executive Andy Jassy later provided analysts with a different perspective, attributing the cuts more to internal company culture issues and excessive management layers than directly to AI or financial pressures.
Nevertheless, Jassy has previously acknowledged expectations that Amazon's corporate workforce will gradually diminish over time as AI-driven efficiencies increase. This reflects a broader trend across the economy where companies are increasingly deploying AI to automate routine tasks, write software code, and reduce operational costs and staffing dependencies.
Scale and Significance of Amazon's Workforce Reduction
If fully implemented, the planned 30,000 job reductions would represent nearly 10 per cent of Amazon's corporate workforce, though this constitutes only a small fraction of its total global workforce of 1.58 million employees. This would nevertheless mark the largest single round of layoffs in Amazon's corporate history, surpassing the approximately 27,000 roles cut during 2022.
The timing of the new cuts carries particular significance, as the 90-day notice period for staff affected in October's redundancies expires on Monday, adding urgency to the company's restructuring timeline. This sequential approach to workforce reduction underscores the ongoing transformation within one of the world's largest technology employers.
As companies worldwide grapple with the implications of artificial intelligence, Amazon's strategic moves and the IMF's warnings highlight the profound changes reshaping global employment patterns, with corporate restructuring and technological advancement increasingly intertwined.
