Amazon is cutting hundreds of employees to shift resources to fast-growing businesses
Amazon is laying off employees in the "low hundreds" an in effort to shift head count allocation to businesses that are growing, CNBC has learned.
The Seattle Times first reported that Amazon was laying off "hundreds" of employees and "managing out" others as the company consolidates its retail operations.
A person familiar with the matter says the cuts are focused on Amazon's Seattle headquarters and will affect some workers globally. The layoffs will occur in the consumer retail business, which includes Amazon's toys, books and groceries units, to make room for head count in businesses that are growing, like Alexa, AWS and digital entertainment. Jeff Bezos, in a statement in the last earnings report, said Amazon would "double down" on Alexa after blowing past projections.
While Amazon supports thousands of jobs, the layoffs are in sharp contrast to its rapid expansion over the past few years. It created 130,000 jobs worldwide last year, not including the nearly 90,000 it added with its acquisition of Whole Foods. It has nearly 4,000 corporate jobs currently open in Seattle and 12,000 worldwide.
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"As part of our annual planning process, we are making head count adjustments across the company - small reductions in a couple of places and aggressive hiring in many others," an Amazon spokesperson told CNBC. "For affected employees, we work to find roles in the areas where we are hiring."
The layoffs follow a rumored hiring freeze put in place late last year. In December, it was reported that Amazon was sharply cutting down on hiring, the first sign of a slowdown in its rapid expansion over the past few years. Amazon also had the smallest number of open positions from August to December of last year, making it the slowest hiring four-month period for Amazon in King County.
The change in Amazon's hiring plan comes as the e-commerce giant seeks the location for its second headquarters. The company drew 238 bids from 54 different regions across North America for the second headquarters, and narrowed it down to 20 finalists last month. Amazon said the winning city will get more than US$5 billion (S$6.6 billion) in investment and employ over 50,000 people.