Amazon could terminate up to 20,000 employees

Nearly 1.3% of Amazon's total global workforce

Amazon could lay off as many as 20,000 workers in the coming months, following a recruiting binge during the pandemic.

Layoffs are anticipated across several locations and departments, including IT, and will impact all staff levels, a report by Computerworld claimed.

Employees at Amazon are graded from level 1 all the way up to level 7.

Twenty thousand workers would equal nearly 1.3% of Amazon's 1.5 million workforce worldwide, including non-permanent workers.

Last month, the New York Times was the first to report that Amazon would engage in widespread layoffs, citing anonymous sources who estimated that as many as 10,000 employees would be affected.

On the 17th November Amazon CEO Andy Jassy informed that layoffs were indeed taking place, although did not say how many staff would be let go.

Amazon has recently asked managers to determine which employees are having performance issues.

Corporate personnel have been informed that those who are let go will be given severance compensation and a 24-hour notice, in line with their contracts.

"There is a sense of fear among employees in the company as the news has come out," one source told ComputerWorld.

"There is no specific department or location mentioned for the cuts; it is across the business. We were told this is as a result of over-hiring during the pandemic and the need for cost-cutting as the company's financials have been on a declining trend," the person added.

Jassy said last month that the layoffs were the result of the "challenging "state of the economy and rapid hiring in recent years.

"We are in the middle of our annual operating planning review where we look at each of our businesses and make decisions about what we believe we should change.

"Leaders across the company are working with their teams and looking at their workforce levels, investments they want to make in the future, and prioritising what matters most to customers and the long-term health of our businesses. This year's review is more difficult due to the fact that the economy remains in a challenging spot and we've hired rapidly the last several years."

Despite an improvement in Amazon's third-quarter earnings from previous quarters, overall profits fell short of expectations. As a result, Amazon was already making cuts in several areas even before it announced the latest layoffs.

Jassy provided further details on the layoffs in an interview at The New York Times DealBook conference last week, saying, "We just felt like we needed to streamline our costs."

Amazon's retail division saw rapid growth during the early days of pandemic, which forced the company to "make decisions at that time to spend a lot more money and to go much faster in building infrastructure than we ever imagined we would," said Jassy.

"We knew we might be overbuilding."

Amazon's Worldwide Digital division, which covers everything from the Alexa voice service and Echo smart speakers to the Prime Video streaming service, experienced an operating loss of almost $3 billion during the first quarter of 2022 - by far the largest area loss.

A source familiar with the division told Business Insider that the overwhelming bulk of the company's losses could be attributed to Alexa, as well as other devices. Amazon has since announced