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Amazon will lay off about 14,000 jobs, or about 4% of its corporate and technology workforce. The company said the move is meant to reduce bureaucracy and help the company run lean. However, a report in the New York Times hints this is just an early step. The company wants to automate up to 75% of its operations by 2027. Not only would that reduce headcount, it will allow the company to not hire more than 160,000 people and save about 30 cents per item delivered.
“The machines aren’t replacing people outright,” Udit Madan, Amazon’s head of worldwide operations, predictably told the Times. “They’re changing what the work looks like.”
Amazon’s just one example of corporate America’s new trend: “Doing more with less” has become the mantra of executives. According to The Wall Street Journal, JPMorgan’s CFO recently said the bank has a “strong bias” against hiring more staff for any new need. Aerospace giant RTX said that sales grew even as its headcount stayed flat. At Intuit, managers are now required to justify every backfill when an employee leaves.
Across the economy, companies are betting that automation – not expansion – will deliver the next wave of productivity growth.
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