Citing economic uncertainty, Amazon announced that it has paused hiring for its corporate workforce for the next few months. In a message delivered to Amazon employees on Nov. 2 and posted on the company’s internal blog, Amazon senior vice president of people experience and technology Beth Galetti pointed to economic unknowns as the impetus behind the move.
“We’re facing an unusual macro-economic environment and want to balance our hiring and investments with being thoughtful about this economy,” she said.
The corporate hiring freeze comes on the heels of last month’s announcement of a fourth-quarter revenue forecast that missed consensus estimates. Amazon said it expected revenue for the final quarter of 2022 in the range of $140 billion to $148 billion, off from the $155.2 billion analysts on average expected. The forecast would reflect an increase of 2 percent to 8 percent from the fourth quarter of 2021. Upon that news, the company announced a halt on corporate and technology hiring in Amazon’s retail business for the rest of the year.
“While we are encouraged by our progress across the business, the macroeconomic environment remains challenging worldwide,” Brian Olsavsky, senior vice president and chief financial officer, said during Amazon’s October earnings call. “The continuing impacts of broadscale inflation, heightened fuel prices and rising energy costs have impacted our sales growth as consumers assess their purchasing power and organizations of all sizes evaluate their technology and advertising spend.”
Amazon isn’t the only company pausing hiring or announcing layoffs. A slew of companies across multiple business sectors such as Lyft, Meta and Robinhood have tightened their belts in recent months, cutting jobs and freezing new hires. In retail, British apparel company Asos announced it would eliminate jobs as part of its cost-cutting strategy, and payment processing platform Stripe said it would cut 14 percent of its employees. VF, StockX, ThredUp, Rent the Runway, Allbirds, and Bed Bath & Beyond are just some of the companies reducing headcount this year.
Galetti said Amazon would continue to monitor both its business and the general economy to determine if adjustments will be made to the hiring pause. She also said that depending on the area of the company, Amazon will continue to hire backfills to replace employees who leave.
The message to employees also said that Amazon still plans to hire a meaningful number of people in 2023, along with making significant investments in its larger businesses and initiatives such as Prime Video, Alexa, grocery, Kuiper, Zoox and healthcare.
While a hiring freeze heading into the holiday selling season may sound like trouble, Galetti assured employees that Amazon has successfully weathered economic storms in the past, and anticipates doing so going forward.
“This is not the first time that we’ve faced uncertain and challenging economies in our past,” she said. “While we have had several years where we’ve expanded our headcount broadly, there have also been several years where we’ve tightened our belt and were more streamlined in how many people we added.”