“It’s Culture”: CEO Andy Jassy on Amazon’s 14,000 Job Cuts

Andy Jassy, Amazon’s CEO, has spoken up about the thousands of job cuts in the company, claiming that the motive was not based on financial grounds.

Discussing the topic at the company’s quarter earnings call on 30 October, Andy said: “The announcement that we made a few days ago was not really financially driven and it’s not even really AI driven, not right now”.

His reason for the 14,000 corporate job cuts: “It’s culture.”

The CEO said Amazon has increased headcount significantly in recent years, and addressed that this type of growth can lead to consequences.

“You end up with a lot more people than what you had before, and you end up with a lot more layers”, he said. “Sometimes without realising it, you can weaken the ownership of the people that you have who are doing the actual work and who own most of the two-way door decisions.”

Announcing Amazon’s job cuts

The job cuts set to affect 4% of Amazon’s corporate workforce were announced on 29 October - framed by the company as reinvention not retrenchment.

The BBC reported that Beth Galetti, Senior Vice President at Amazon, said in a note to employees: “We’re convicted that we need to be organised more leanly, with fewer layers and more ownership, to move as quickly as possible for our customers and business.”

She added that the changes would make the multinational tech company “even stronger” by allowing it to “shift resources to ensure we’re investing in our biggest bets and what matters most to our customers’ current and future needs”.

Andy has sought to streamline layers of management in the past to ensure the company operates like “the world’s largest startup”.

In late 2024, he issued a memo to employees saying that to operate like a startup, the ecommerce giant would “end its previous hybrid work policy” - requiring corporate staff to return to the office full-time.

The CEO said that this approach demands “a mix of constant invention, high ownership, strong urgency and shared commitment” and aims to “increase the ratio of individual contributors to managers, improve innovation and deepen collaboration” by flattening the organisation.

In a letter in 2024 to shareholders, Andy added on the topic of change: “Speed is a leadership decision.

“The leadership team has to believe it's a priority, reinforce it constantly, organise and remove structural barriers and build in modular ways that enable pace.

“But speed does not happen unless the entire company and culture embrace it.”

Job cuts elsewhere

According to CNN, Amazon said this week that the layoffs were more about staying “nimble” in anticipation of future AI efficiencies.

But Amazon is not alone, with other large companies laying off thousands of workers in the last couple months, including Salesforce, Paramount and Target for a variety of reasons.

UPS announced on 28 October during its Q3 earnings announcement that it has plans to reduce its workforce by tens of thousands.

This is as part of the company’s strategy to improve efficiency through increased automation.

Discussing the changes, company CEO Carol B. Tomé said: “We are executing the most significant strategic change in direction in UPS’s history, and the changes we are implementing are designed to deliver long-term value for all stakeholders.”

Salesforce reduced its customer support workforce by nearly half, cutting 4,000 jobs this year as AI takes on a larger share of customer service.

Marc Benioff, CEO of Salesforce, said on The Logan Bartlett Show: “I was able to rebalance my headcount on my support. From 9,000 heads to about 5,000 because I need less heads.”

Marc said that half of customer service enquiries are now handled by AI.

Jobs cuts like these are spurring speculation about technology replacing human workers and the future of AI-human collaboration.