Big Tech Hit by Inflation Undergoes Successive Workforce Adjustments

US Amazon Freezes Retail Sector Hiring This Year

(Photo by WSJ)

[Asia Economy Reporter Yujin Cho] Big tech companies are lining up to cut staff due to high-intensity tightening policies and the impact of inflation. As the rapid growth of big tech companies fueled by the COVID-19 pandemic slows down due to the economic recession, it has become inevitable to reduce the expanded business scale.

On the 4th (local time), the Wall Street Journal (WSJ), citing a well-informed source, reported that Amazon will halt hiring for necessary technical personnel in its retail division until the end of the year.

The hiring freeze does not include employees in the most profitable cloud division (Amazon Web Services) or large-scale blue-collar workers such as warehouse operators.

Amazon, which posted record-breaking performance during the COVID-19 period, recorded a net loss of $3.8 billion in the first quarter and $2 billion in the second quarter this year due to a decline in online sales.

Amazon spokesperson Brad Glaser said, "We have businesses at various stages of evolution, and we will continue to adjust our hiring strategies for these businesses at the appropriate time."

WSJ reported that as online sales, which rapidly expanded during the COVID-19 pandemic, have recently started to decline, reductions in the workforce and warehouses, which had been significantly increased, have become inevitable.

Accordingly, Amazon has reduced its workforce by 100,000 from March to June, bringing the total number of employees, including temporary workers, to 1.5 million as of the end of the half-year.

Following Apple, the world's largest market capitalization company, major big tech companies such as Meta, Google, and Microsoft (MS) are also proceeding with hiring and cost reductions.

Employees targeted for organizational restructuring are offered opportunities to be reassigned to other departments, but by limiting the timing and scope, the workforce reallocation is expected to effectively result in a 'net reduction' of staff.

Google is also known to be encouraging layoffs through departmental reassignments. Last week, Google designated half of the approximately 100 employees in its internal startup incubator 'Area 120' for transfer and ordered them to find other jobs within the company within 90 days.

Google provides 60 days for laid-off employees to find new roles within the company, but internal staff reported that Area 120 employees face greater time constraints due to frequent project cancellations.

Earlier, Apple also decided to reduce hiring and spending due to recession concerns. It plans to cut next year's budget by department compared to previous levels and induce 'natural attrition' by not filling vacancies left by departing employees in some departments.

As part of restructuring, Apple recently laid off 100 recruiters. MS also implemented layoffs reducing less than 1% of total employees in each business division.

This content was produced with the assistance of AI translation services.