Amazon, one of the largest tech employers in the world, has revealed that it is now hiring at the slowest pace since 2019 and has cut over 100,000 employees globally in the June quarter, likely due to the dramatic economic slowdown since 2021. It is the largest workforce cut in a single quarter in the history of the company. The layoffs are part of an increasing trend of protecting the bottom line within the tech industry. The cuts likely played a large role in Amazon’s recent revenues beat and their rosy profit projections for the third quarter, though it still lost a net $2 billion in the second quarter.
The more employees lose their jobs, the more healthy the company appears to be when shareholders examine quarterly earnings; it is inevitable that layoffs will continue. There have been over 30,000 job cuts by tech companies in the US in the past few months alone, and unemployment claims have climbed to 8-month highs.
The covid pandemic lockdowns and subsequent stimulus checks created an enormous artificial boost for tech companies like Amazon in 2020 and 2021, but the $6 trillion stimulus has since circulated out of the pockets of most Americans and globally the lockdowns did incredible harm to existing economic stability. Demand for peripheral goods is in steep decline as inflation in necessities continues to rise. In 2022, the stagflation crisis is leading to imminent demand destruction. Source: ZeroHedge