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According to a blog post published by CEO Andy Jassy on Tuesday, Amazon will reduce its total workforce as artificial intelligence will take over more tasks. Jassy said the e-commerce giant “will probably be fewer people doing some of the work that's going to be doing today, and fewer people need to be doing other kinds of jobs.”
He adorns the bomb by examining all the ways AI improves Amazon products and services such as Alexa+ and shopping features “lenses” and “my purchases”, as well as Amazon Web Services Innovations such as Trainium2 and Bedrock. Internally, Amazon uses robots in fulfillment centers and AI to manage inventory and forecast demand.
Jassy also said Amazon will continue to evolve due to the new capabilities of AI agents that are expected to accelerate internal processes and innovation, and as the company aims to maintain a fast startup approach to its operations.
“It's difficult to know exactly where this is online over time, but in the next few years, this will reduce the total workforce of a company, as it will provide greater efficiency through widespread use of AI across the company,” Jassy wrote on his blog.
Many companies, including Duolingo, Salesforce, Shopify, and Klarna, have already had the opportunity to reduce opportunities and reduce staffing after integrating AI. Openai CEO Sam Altman recently predicted that “all classes of employment” would disappear in the 2030s as a result of advances in technology.
The high-tech giants are competing for AI hegemony, and internal efficiency is their victory formula
Amazon is not used to layoffs. It was one of the companies that rapidly expanded their jobs to meet the surge in demand for online shopping and home technology during the pandemic, but after that demand settled, it became overstaffed. As a result, more than 100,000 jobs were cut in 2022 on Amazon, Google, Meta and others.
Since then, the company has focused on lasers on improving efficiency in order to keep pace with other tech giants pursuing similar AI initiatives. They all recognize this early stage of AI development as an important window to quickly move and secure a major location, but this has created a tense high-stakes workplace culture.
In March, an Amazon employee told Business Insider that “there is a lot of pressure to carry out the work of multiple people with the mercy of a ruthless middle manager.” Since September, Jassy's company has been actively working to increase the contributor manager ratio by 15%, ensuring the latter moves faster.
According to Business Insider, Google cut the roles of managers and vice presidents by 10% for the same reasons. Microsoft fired 3% of its workforce last month, focusing on both managers and software developers. Although it doesn't link the migration to AI directly, Microsoft uses the generation tool to write up to 30% of your coding project.
However, some companies want to continue to touch people.
This ruthless pursuit of efficiency has led some companies to replace their staff with AI, but not all are suing. Google has reduced the number of managers, but Alphabet CEO Sundar Pichai plans to continue hiring new engineers as AI.
Research shows that 55% of companies that fired staff for automation regret the decision. Klarna CEO Sebastian Siemiatkowski told Bloomberg that he “recognized that it's clear that it's clear to customers that there's always a human being in their customers. This was a major shift, as Siemiatkowski previously believed that AI could handle all human work.
At certain levels, there is evidence that AI use can reduce revenue. Last year, Carnegie Mellon University created a simulated company fully deployed by AI agents from a major tech company, assessing its performance in real office tasks. The results reveal that even the most advanced AI models are struggling significantly, along with top performer Claude 3.5 Sonnet, completing less than 25% of their allocation.
More and more workers are being pushed back. A survey in March found that 31% of employees refused to use AI tools or outputs, and refused to adopt technology that stems from fear of work movement and frustration over the tools provided.
Read Eweek's report How workers are employed in the age of AIhighlights key strategies for adapting to the demands of automation and evolving work.
