Amazon in the US to Cut up to 30,000 Jobs Starting on the 28th: Is the Mass Layoff of White-Collar Workers the "Reality of the AI Era"?

Amazon in the US to Cut up to 30,000 Jobs Starting on the 28th: Is the Mass Layoff of White-Collar Workers the "Reality of the AI Era"?

1. What is Happening

Amazon is preparing to cut up to 30,000 white-collar jobs, primarily in headquarters and management roles, with notifications starting from October 28.
This scale is equivalent to about 10% of the headquarters employees, making it one of the largest in the company's history, potentially surpassing the 27,000 cuts made in 2022-2023.
Amazon is a massive employer with about 1.55 million employees worldwide, and a restructuring of this class will have repercussions not only in the tech industry but also in the entire U.S. job market.

2. Why Now?

The reasons can be summarized into three points.
The first is the reassessment of the workforce hired excessively during the COVID-19 pandemic, leading to overlapping departments and a thick layer of middle management.
The second is cost reallocation, compressing labor costs to direct funds towards "priority investment areas" such as generative AI, robotics, and cloud infrastructure.
The third is the automation of tasks by AI. Management sees that "white-collar work itself," such as administration, HR, and planning, can be replaced by AI.

3. Where Will the Cuts Be Made?

The targets are said to be HR (PXT), Devices & Services (such as Alexa), operations planning, AWS-related planning and support, and back-office functions.
Particularly in HR and labor support, tasks like responding to inquiries and document checks are easily replaceable by AI and automated response tools, with reports of a 15% reduction plan.
AWS is also required to have a "faster and leaner sales/support structure."

4. Historical Scale

Layoffs of this scale are unusual even among large U.S. companies. Boeing's case of cutting about 31,000 jobs in 2001 is considered "one of the largest in history," and Amazon's plan for 30,000 has a similar impact.
Amazon is one of the leading private employers in the U.S., and the message that "10% of white-collar jobs can be cut" is likely to spread to other major companies.

5. AI is No Longer a "Future Topic"

Amazon executives have explained to employees that they aim to "reduce bureaucracy and remove layers."
This is a declaration to thin out the "middle layers" like department heads, senior managers, and directors, and to let AI handle routine tasks such as meeting coordination and document preparation.
CEO Andy Jassy has already indicated internally and externally that "the total number of white-collar jobs will further decrease with generative AI," and this move is seen as a realization of that outlook.

6. However, Field Work is Necessary

Meanwhile, it is reported that Amazon plans to maintain a workforce of about 250,000 for warehouse and delivery staff for the year-end sales season.
In other words, while "headquarters white-collar jobs are being permanently slimmed down," the "workforce for busy periods is rapidly increased," creating a bipolar model.
This also means that there are more situations where short-term operational staff are needed rather than permanent managerial employees.

7. Process for Employees

Employees targeted for cuts will be notified by email and given a 90-day period to find another position within the company.
If they cannot find a position, they will move on to a severance package.
Simultaneously, Amazon is strongly urging employees who want to continue working from home to return to the office, setting up a flow where "those who do not fit the company's way will naturally leave."

8. Investor Reaction

At the time of the report, Amazon's stock rose, closing with a gain of over 1%.
The market evaluated this as a sign that Amazon is "seriously starting cost management."
Particularly, AWS requires massive investment in AI infrastructure, and competition with rivals like Microsoft and Google is intense. The slimming down was welcomed as a declaration to "bet on AI while protecting profit margins."

9. The Future of U.S. Tech Employment

Not only Amazon, but also Microsoft, Meta, and Alphabet are cutting white-collar jobs while actively investing in AI and robotics.
In other words, U.S. tech employment has entered a phase of "reducing traditional office jobs and replacing them with talent possessing AI development and operational skills."
Layoffs are painful, but from the company's perspective, it's closer to a "reshuffling of the talent portfolio."

10. Impact on Japan

Currently, North America and Europe are the focus, but pressure to "achieve the same results with the same number of people" and "operate with AI tools" is expected to come to offices in countries including Japan with a time lag.
Especially in back-office operations, areas are easily centralized with multilingual AI and automated responses.
The logic of "if having a local team loses its meaning, reduce the number of people" is unavoidable even for foreign-affiliated Japanese corporations.

11. 30,000 or 14,000?

Reports mention an upper limit of "up to 30,000," while also indicating that approximately 14,000 people are initially targeted for notification in the first phase.
This suggests a phased scenario of "not all 30,000 at once," but "starting with 10,000 and expanding if necessary."
This means that this restructuring is not a one-time event, and waves may come several times depending on the situation.

12. Summary

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