Copyright Newsweek
A number of companies across sectors such as retail, tech, and telecommunications are in the process of laying off thousands of American workers. Several firms have in recent weeks announced plans to significantly trim their headcounts, spurned by company-specific factors, but against the backdrop of an increasingly precarious economic situation and the rise of automation and artificial intelligence. Why It Matters In the U.S., the labor market has been spared the mass layoffs to match the low levels of job openings seen in recent months—with Federal Reserve Chair Jerome Powell describing it as a “low-hire, low-fire economy.” However, economist Mark Zandi has told Newsweek that low levels of layoffs serve as the “firewall between recession and no recession,” and that firings on a larger scale could be what pushes the country into an economic downturn. Which Companies Are Cutting Jobs? Amazon In what marks the largest corporate layoff announcement of the year, Amazon announced this week that it will be cutting roughly 14,000 positions. In a memo sent to employees, Amazon said that developments in AI were enabling companies “to innovate much faster than ever before,” and cited the need to “be organized more leanly, with fewer layers and more ownership.” Target Last week, Target told its workforce it would be laying off around 1,000 employees and eliminating roughly 800 open positions. The announcement followed months of financial struggles for the retailer, and Target’s incoming CEO Michael Fiddelke said the move would help “set the course for our company to be stronger, faster and better positioned.” Charter Telecom giant Charter Communications is planning to lay off roughly 1,200 U.S. employees, according to recent reporting by Reuters and the Los Angeles Times, equating to just over one percent of its 95,000-strong workforce. An anonymous source familiar with the matter told the Times that the layoffs were aimed at streamlining management, and would be focused at Charter’s headquarters in Stanford, Connecticut, as well as its bases in Charlotte, North Carolina, Denver, Colorado and St. Louis, Missouri. Novo Nordisk The Danish pharmaceutical firm behind Ozempic and the adjacent medication Wegovy announced in September that it would be cutting around 9,000 positions globally. The company cited increased competition in the obesity drug space, as well as the over $1 billion in annual savings its efficiency push could yield. The company said that 5,000 of the cuts would be in Denmark, but the layoffs are also affecting employees at its U.S. plants, according to Reuters, which began in mid-October. Paramount Skydance The CBS parent company has embarked on a major workforce reduction plan, anonymous sources told Bloomberg and Reuters, and this week initiated around 1,000 job cuts in the U.S. According to the reports, the layoffs are part of broader plan to cut $2 billion in costs following on from the $8 billion merger between Paramount Global and Skydance Media which completed in August. What Other Layoffs Are Ongoing? Other companies have announced similar workforce reduction plans earlier, such as Microsoft, which has initiated several rounds of mass redundancies in 2025. On Tuesday, United Parcel Service (UPS) revealed that it had cut 48,000 positions since the start of the year, greater than the previously anticipated 20,000. The company noted that these layoffs have already taken effect, but said it would be pressing on with its push for greater efficiency. In September, Starbucks announced a $1 billion restructuring plan it said would involve laying off around 900 non-retail workers. What People Are Saying Economist and MIT professor Daron Acemoglu, speaking to Newsweek on the Amazon layoffs, said: “I think many companies are going to test the limits of AI for automating white-collar jobs. Amazon will probably need to engage in some sort of cost-cutting at some stage, and like many tech-savvy companies, they are looking at AI. I am still skeptical that it can do large-scale automation of office jobs given the current crop of AI models, but the prospect of cost reductions will motivate many experiments.” “I don't think we are at the cusp of mass unemployment,” he added. “AI models have many limitations, and while there will be companies such as Amazon that will attempt to organize work to get more out of AI and reduce their headcount, at the macroeconomic level things will go more slowly.” Bloomberg economist Stuart Paul, in an interview on Tuesday, said: “When you have a lot of these high-profile layoff announcements, we can make a lot of hay out of it—finding a macroeconomic needle in the haystack is a little bit harder.” “When you get to something like UPS announcing that it had shed so many jobs, let’s face it some of that is downstream from labor renegotiations and contract disputes in 2023. It’s shocking to see how many jobs have been shed,” he continued. “Something like Amazon, it looks like its more structural, and it looks like it has more to do with implementation of AI reverberating through some management [and] some of the headquarter operations.” What Happens Next Some of the companies have said they expect further headcount reductions in the coming months. Amazon this week said it anticipates hiring in certain areas “while also finding additional places we can remove layers, increase ownership, and realize efficiency gains.”
