The world’s largest online retailer Amazon is cutting around 14,000 administrative jobs.
The company explained the reduction in a statement with changes in the organization in times of artificial intelligence. Shipping activities in Germany and other countries are unlikely to suffer from the reduction in office jobs. It was initially unclear to what extent jobs in Germany would be affected by the cuts.
Remodeling for AI
Amazon itself raised the question of why it was making cuts while business was doing well. One should not forget that the world is changing rapidly, was the response. The group referred to the current applications with artificial intelligence, which allowed faster innovations. Therefore, as a company you have to position yourself as leanly as possible.
There has been discussion for months about whether AI software like ChatGPT or Claude from the Amazon-backed developer Anthropic could make many office jobs unnecessary. According to the developer companies, the programs can sometimes carry out knowledge tasks and automate administrative processes on their own. The development has so far been felt by employees in programmer jobs, among others – because AI is good at writing software code.
No consequences for deliveries
Consumers in Germany are unlikely to feel the consequences of job cuts. On the one hand, it’s only about the administration, not about the employees in the huge warehouses. And the parcel deliverers who deliver the shipments are not directly employed by the company, but rather work as subcontractors – a circumstance that the Verdi union has been criticizing for years. In general, Verdi has bad views on Amazon – the company has long refused to conclude a collective agreement.
At the same time, Amazon is investing significantly more heavily in Germany than before; according to company information, in 2024 it was around 14 billion euros, two billion more than in 2023. According to a statement by Germany boss Rocco Bräuniger at a company presentation in September, heavy investments will continue. At that time there was no talk of job cuts. The investments are largely going towards better automation of logistics processes – more and more robots are being used to relieve people of work.
A total of around 40,000 jobs in Germany
The US group has a good 40,000 employees in Germany at more than 100 locations, including sorting and logistics centers, administrative offices in Munich and Berlin as well as development locations – so in Aachen they are working on making the language assistant Alexa better and also understand German dialects well. Data centers from the AWS (Amazon Web Services) cloud division are also included. There has recently been a significant increase in personnel in Germany; the company has created 4,000 jobs within a year.
Reports of even greater degradation
Amazon pointed out in the statement that new jobs would be created in other areas at the same time. Most affected employees should also be given 90 days to look for other positions within the company. Among other things, this
"Wall Street Journal" reported, citing informed people, that up to 30,000 jobs could be affected by the cuts in several waves. With the simultaneous development in other areas, that could also be true.
Largest online retailer in Germany
Roughly speaking, Amazon accounts for 60 percent of online trading in Germany – including the marketplace where other smaller retailers use Amazon as a sales platform.
The Federal Cartel Office is following Amazon’s development critically and is taking action against the US company – the competition watchdog sees an “outstanding cross-market importance for competition”. The federal agency has expressed concerns that Amazon is exploiting its market power to the detriment of consumers and other retailers. There are two proceedings against Amazon. One is about the accusation of price control – Amazon has already been sent a warning. This is still a preliminary assessment, Amazon now has the opportunity to comment.
Amazon is becoming increasingly important in the parcel market
Amazon is becoming increasingly important not only as an online retailer, but also as a parcel company: goods ordered from the online retailer are also delivered by logistics companies such as DHL, but a larger proportion are also delivered by Amazon itself. According to the Federal Network Agency, Amazon is already number 2 in the parcel market in Germany, with the US company accounting for between 15 and 25 percent of the shipment volumes delivered. DHL has a market share of more than 40 percent, significantly more than Hermes, DPD, UPS and GLS, which only have 5 to 15 percent.