Amazon has announced it will eliminate about 14,000 corporate roles as part of a broader effort to reduce costs while accelerating its investments in artificial intelligence. Employees affected by this decision will be notified on Tuesday, with most receiving a 90-day window to explore other roles within the company. Those unable to secure a new position or who choose not to apply will be provided with severance pay, career support, and health insurance coverage.

Currently, Amazon employs roughly 350,000 corporate workers and a total global workforce of 1.56 million. The latest cuts represent nearly 4% of its corporate staff, signaling another major workforce reshaping since the company’s rapid pandemic expansion.

A Push Toward AI-Driven Future

Since taking over as CEO in 2021, Andy Jassy has focused on improving efficiency and preparing Amazon for the AI era. Earlier this year, he mentioned that generative AI would likely lead to a reduction in corporate roles as automation becomes more integrated into operations. According to Jassy, Amazon already has over 1,000 AI-based applications and tools in development, and that number is expected to grow substantially.

Amazon is also investing heavily in infrastructure to support its AI ambitions. The company has pledged about $10 billion each for new data center projects across Mississippi, Indiana, Ohio, and North Carolina. Its new North Carolina campus, valued at another $10 billion, will serve as a key hub for cloud computing and AI innovation. These large-scale commitments position Amazon to compete with other tech leaders like OpenAI, Google, Microsoft, and Meta.

The Strategy Behind the Shift

Jassy believes that AI is central to Amazon’s future. “If you believe your mission is to make customers’ lives easier and better every day, and you believe every experience will be reinvented with AI, you have to invest aggressively in it,” he said earlier this year. Amazon’s upcoming projects, including its new voice assistant Alexa+, reflect that focus on integrating AI into every part of its ecosystem.

During the pandemic, Amazon’s workforce doubled as online shopping surged. However, in the years that followed, tech companies including Amazon have been cutting jobs to recalibrate spending. The latest layoffs mark the largest since 2023, when Amazon eliminated 27,000 positions in multiple phases.

Navigating an Uncertain Economy

Although Amazon continues to perform well, broader economic conditions remain uncertain. The U.S. job market, once considered strong, has begun showing signs of cooling. A recent ADP report revealed private sector job losses in September, while many retailers are reducing seasonal hiring due to concerns about the economy and tariffs. Still, Amazon plans to hire 250,000 seasonal workers for the holidays, matching last year’s number.

Neil Saunders, Managing Director of GlobalData, described the move as “a deep cleaning of Amazon’s corporate workforce.” He noted that while Amazon remains financially strong, the company is strategically redirecting resources. “This is a tipping point away from human capital to technological infrastructure,” Saunders said.

Amazon is scheduled to release its quarterly financial results on Thursday. Its most recent report showed a 17.5 percent growth in Amazon Web Services, underscoring the company’s continued dominance in cloud computing.