Amazon Layoffs, AWS, and HR Face Trouble

Amazon continues to lay off workers; this time, the AWS and HR departments are affected.

Employees of AWS in the US, Canada, and Costa Rica who were affected by the layoffs received an email from CEO Adam Selipsky and HR Director Beth Galetti early on Wednesday.

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The second round of Amazon’s layoffs, which the company announced last month, started on Wednesday. Around 9,000 employees will be impacted by this new round of layoffs across several divisions, starting with its cloud service operation and human resources divisions.

The layoffs occur as sales growth for Amazon Web Services (AWS), the company’s most lucrative division, slows. The notification of the layoffs states that AWS employees will be affected worldwide, starting with those in the US, Canada, and Costa Rica. CEO Adam Selipsky and Human Resources Director Beth Galetti informed affected workers of the layoffs early on Wednesday.

In an internal memo that CNBC was able to obtain, AWS CEO Adam Selipsky stated, “It is a tough day across our organization.” “Difficult decision to eliminate some roles across Amazon globally, including within AWS, and the conversations with impacted AWS employees started today, with notification messages sent to all impacted employees in the US, Canada, and Costa Rica,” he continued.

We are making a lot of effort to show respect to everyone who is impacted and to offer a variety of resources and touchpoints to help with this transition. Selipsky continued in the memo to Amazonians, “This also includes packages that include a separation payment, transitional health insurance benefits, and external job placement support.

In addition to the 18,000 layoffs that were previously announced in November 2017 and January 2018, CEO Andy Jassy announced 9,000 additional layoffs in March. As part of this strategy, Amazon reduced its workforce on April 18 by laying off several workers from its advertising division.

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Amazon started reducing costs by stopping some projects, freezing hiring, and slowing warehouse expansion due to worries about a recession. Amazon has chosen to be more streamlined in light of the uncertain economy and the “uncertainty that exists shortly,” according to CEO Andy Jassey’s note from last month.

Notably, Amazon increased hiring during the pandemic to meet the growing demand from homebound Americans making online purchases, just like other major tech players like Facebook’s parent company Meta, and Google’s parent company Alphabet. The AWS division, meanwhile, saw a significant increase during the pandemic, helping Amazon and other cloud service providers as businesses, governments, and educational institutions accelerated their migration to the cloud.

“However, due to businesses cutting back on spending in a difficult economic climate, both AWS and ads have seen slowing growth in recent months. The business decided to implement drastic cost-cutting measures as a result, which included reducing its workforce. The earlier round of layoffs included some teams within AWS.

Selipsky continues in the memo, “Given [our] rapid growth, as well as the overall business and macroeconomic environment, we must focus on identifying and allocating our resources behind our top priorities-those things that matter most to customers and that will advance our business. “In many cases, this entails team members changing the projects, initiatives, or teams on which they work; in other cases, it has led to these role eliminations,” the author writes. As we assist them in minimizing expense, accelerating innovation, and transforming their organizations, Selipsky continued, “We are focused on continuing to innovate in the areas that matter most to our customers.”

According to Selipsky, job cuts outside of North America would adhere to local procedures, including consultations with labor unions when necessary. Layoffs have already affected a few AWS teams, such as recruiters and members of the “Just Walk Out” technology group.

The retail group, the devices teams, and the recruiting and HR teams were the main targets of the initial round of layoffs. The HR group, which has been the target of buyout offers and cuts since November, experienced additional cuts on Wednesday. The latest layoffs were announced by Beth Galetti, head of the People Experience and Technology team (HR), in an email on Wednesday. She acknowledged the effect on both departing and remaining employees.

HR director Beth Galetti further explained to the Amazonians, “These decisions are not made lightly, and I recognize the impact it will have across both those transitioning out of the company as well as our colleagues who remain.”

In a related development, Amazon revealed the closure of its Halo division, which sells fitness and sleep trackers, on Wednesday. As of July 31st, Amazon will no longer support Halo services and will issue refunds for Halo device purchases made in the previous twelve months. Although the number of affected employees has not been disclosed, the company has notified affected employees in the US and Canada.

With the release of the first Halo band, a fitness tracker that offered access to health monitoring and analysis services, the Halo division was established in 2020. Later, the division unveiled two more goods, the smart alarm clock Halo Rise and a contactless sleep tracker called Halo View.