Thousands of workers have seen their jobs eliminated this fall at large companies including Amazon (AMZN), UPS (UPS), Nestlé (NSRGY), in an economy defined by uncertainty, AI, and global tensions.
The latest: 15,000 cuts at Verizon, to be done mostly through layoffs, the Wall Street Journal reported Thursday. It would be the carrier’s largest downsizing ever, affecting about 15% of its workforce.
The Journal cited sources who said the company aims to cut costs in the face of increased competition for cell and home internet customers.
The news follows announcements from major employers of thousands of job cuts. UPS said in its third quarter earnings results that it had cut its “operational workforce by approximately 34,000 positions” in the first nine months of the year as it looked to be more efficient, while about 14,000 positions, primarily in management, had also been eliminated.
Target (TGT) has plans to axe 1,800 corporate roles, while Paramount Skydance (PSKY) is set to slash about 1,000 positions. Even perceived winners in the AI-fueled economy, like Meta (META), have announced layoffs — in its AI unit, no less. Rivian (RIVN) is also reportedly implementing workforce reductions.
Amazon said in a message to employees last month that it would reduce its “corporate workforce” by approximately 14,000 roles. The announcement raised the question: Was it a signal that workers were being replaced by emerging technology that has threatened to make them obsolete?
Andy Jassy, Amazon’s CEO, said the workforce reduction “was not really financially driven, and it’s not even really AI driven — not right now, at least.”
“It’s culture,” Jassy said. “If you grow as fast as we did for several years — the size of businesses, the number of people, the number of locations, the types of businesses you’re in — you end up with a lot more people than what you had before, and you end up with a lot more layers.”
Workers wouldn’t be blamed for having whiplash, though. The labor market was strong just a few years ago, with openings reaching a record high in 2022 amid a surge of resignations. Job postings for tech and mathematics in particular peaked early that year at more than double their February 2020 level, according to Indeed research, only to plunge 36% below that pre-pandemic level by July of this year.
Indeed noted that the earlier hiring boom, broader economic conditions, and interest in AI could explain this year’s “crash in demand for tech workers.”
“If we take a look at Amazon, we know they hired very aggressively between 2017 and 2022, adding tons of workers during the pandemic, so I’m not surprised that there’s been a correction there,” Timothy DeStefano, a professor of economics at Georgetown University, told Yahoo Finance.