Amazon may cut 5,000 jobs, shut down 15 warehouses

Amazon may be planning to cut as many as 5,000 jobs in the US. The American giant is expected to also close 15 warehouses in New York City. But the impact could be even greater.As per a report from New York Post, Amazon may cut 5,000 delivery jobs in New York City if the proposed Delivery Protection Act is enacted. The bill, backed by Mayor Zohran Mamdani, would require Amazon to directly employ more than 5,000 delivery workers who currently work for 40 third-party contractors. In addition, Amazon may shut down 15 warehouses that could impact another 2,000 workers.Why Amazon may cut 5,000 delivery jobs?Amazon does not directly employ delivery drivers. Rather, it relies on third-party contractors for delivery roles. If the bill is passed, the company would need to change its delivery model and employ delivery workers directly.While supporters of the NYC bill argue that it would allow for better wages and working conditions, some are concerned that Amazon may go through with the job cuts citing Amazon’s withdrawal from Quebec. The company shut down seven warehouses in the Canadian region after a unionisation drive at its Laval facility. The closures led to about 1,900 warehouse workers and 2,800 contracted delivery workers losing their jobs last year. Do note that Amazon denies that the closures were linked to the unionisation drive.The report adds that there may be possible compromises. This could include allowing contractors to continue making deliveries while requiring Amazon to provide stronger safety guarantees. No vote has been scheduled for the bill yet. At the same time, the report cites contractors who have warned that the bill may force them out of business. Contractors are worried that Amazon may replace its city facilities with warehouses along the New Jersey Turnpike.Joe Artus, owner of WGA Transit, said the bill could leave him struggling to retain his 189 employees. His company recruits formerly incarcerated and homeless workers. "I have a 21-month-old daughter," Artus told the publication. "If this thing passes, there is no way for my company to exist or to keep my 189 employees."As per the report, Amazon said closing the warehouses would increase delivery times and prices. A company-funded study estimated that the legislation would cost New Yorkers an additional $664 a year, or about $5.20 per package, including deliveries by other companies. Same-day and same-morning deliveries are likely to be the most affected.The possible New York cuts come as Amazon reduces its global workforce. The company recently cut just under 1,000 jobs, mainly in retail teams in countries including India, the US and the UK, as part of broader layoffs expected to affect about 30,000 roles. Amazon founder Jeff Bezos said the cuts were necessary because the company had overhired during the pandemic. The company is also preparing to spend a record $220 billion on data centres, chips and other artificial intelligence infrastructure.- Ends