Internal Amazon data shows retail managers hardest hit by US job cuts. Employees worry AWS could be next.

Tuesday's job cuts at Amazon disproportionately affected early and mid-career managers in the company's retail operations, based on internal documents reviewed by Business Insider. Employees are now speculating that Amazon Web Services may face similar reductions.

Internal data examined by BI revealed that over 78% of the eliminated positions were manager-level roles ranging from L5 to L7 designations. The information primarily covers US-based operations, where L5 represents the entry tier for management positions, with increasing seniority at higher levels.

The US data further indicated that more than 80% of those laid off worked within Amazon's retail sector, including e-commerce, human resources, and supply chain operations.

These reductions underscore Amazon's effort to flatten its organizational hierarchy and eliminate bureaucratic layers. CEO Andy Jassy has reduced the manager-to-employee ratio by 15% throughout the year as part of a comprehensive initiative to strengthen operational discipline and transform the company's culture. The concentration on retail personnel also demonstrates Amazon's pursuit of greater efficiency and improved profitability in its most established division.

The figures represent approximately 7,500 employees who initially received termination notifications on Tuesday, predominantly US-based workers. An additional 6,500 affected employees were primarily located in various international markets, including India and Europe, according to a source with direct knowledge of the situation who spoke to Business Insider.

Key developments in the Amazon layoffs:

• Amazon's termination notice to affected employees
• Amazon executive urges remaining staff to 'embrace AI' in internal communication following large-scale layoffs
• Amazon's message to Audible employees as audiobook unit faces cuts

An Amazon representative did not provide a response to requests for comment. The company revealed on Tuesday its intention to eliminate 14,000 corporate positions to become more agile and "innovate much faster." These cuts are part of a potentially larger wave that could reach 30,000 positions, according to reporting by Reuters and the Wall Street Journal.

AWS Employees Express Concern

The internal data shows that approximately 5% of the reductions affected the advertising division, while AWS accounted for less than 1% of the cuts.

Related coverage:

• Amazon layoffs: Current information on affected teams and positions, based on internal communications
• Amazon eliminates 14,000 corporate roles to operate more efficiently in the AI era

Nevertheless, multiple employees informed Business Insider that further workforce reductions are anticipated in early 2026, with AWS expected to bear a larger share. One source indicated that certain AWS teams recently received directives to decrease headcount by 5% in 2025 and 10% in 2026. These individuals requested anonymity as they lack authorization to communicate with the press.

On Tuesday, HR leader Beth Galetti characterized the workforce reductions as part of a continuous effort to operate Amazon "like the world's largest startup." Despite strong company performance, staff reductions are necessary because the accelerating adoption of AI is reshaping the competitive environment, she noted. Amazon will maintain hiring activities while identifying "additional places we can remove layers," Galetti stated.

Amazon's retail operations had already begun implementing cost controls. The company implemented a freeze on its retail hiring budget earlier in the year, with leadership emphasizing eliminating inefficiencies to allocate resources toward faster delivery expansion and broader product offerings. Multiple employees told Business Insider that a comprehensive retail hiring freeze continues, with approval granted for only select replacement positions.

For the retail organization, expense reduction has become increasingly vital. Amazon is rapidly scaling its expedited delivery infrastructure and grocery operations—both lower-margin initiatives—while investing heavily in robotics, automation, and AI technologies to achieve long-term operational improvements.

Companies around the globe have ramped up job cuts, with blue-chips from Amazon (AMZN.O)

, opens new tab to Nestle (NESN.S), opens new tab and UPS (UPS.N), opens new tab, reining in spending while consumer sentiment dims and AI-focused tech companies start to replace jobs with automation.

According to a Reuters tally, American companies have announced more than 25,000 job cuts this month, not including UPS's 48,000 figure, which dates from the beginning of 2025. In Europe, the total tops 20,000, with Nestlé accounting for the bulk after last week’s 16,000-role reduction.

With economy-wide numbers on job cuts not available, given the U.S. government is in the middle of its second-longest shutdown in history, investors are paying extra attention to these anecdotal stories of layoffs. That's even if year-end layoffs are common and many of the eye-catching cuts will be stretched out over a prolonged period.

"Investors are asking themselves, what does this mean? And specifically, what's the overall picture since we can't see it?" said Adam Sarhan, chief executive of 50 Park Investments in New York. Cuts like those at Amazon "tell me the economy is slowing down, not getting stronger. You don't have mass layoffs when the economy is strong."

CEOs WANT A RETURN ON BIG AI SPENDING

Amazon said it would cut up to 14,000 jobs from its corporate workforce, joining Target, Procter & Gamble, and others in axing thousands of office roles. Reuters reported on Mondaythat as many as 30,000 Amazon jobs could be eliminated.

The reasons for the cuts vary. Some, like Target and Nestle, have new CEOs eager to restructure their operations. Baby-apparel company Carter's is slashing 15% of office jobs as it struggles with hefty import tariffs imposed by U.S. President Donald Trump.

What stands out is the focus by companies like Amazon and Target on white-collar roles seen as vulnerable to AI-driven automation, rather than those on shop or factory floors. Some analysts say Amazon's move could be an early sign of deeper structural shifts as companies push to justify billions spent on AI tools.

Target's cuts affect 8% of its corporate staff, but Amazon's cuts affect just 14,000 positions within its 1.5 million-strong workforce.

KPMG’s latest survey of U.S.-based executive,s released in Septemb,er shows projected AI investment has jumped 14% since the first quarter to an average of $130 million over the next year. And 78% of executives say they are under intense pressure from boards and investors to prove AI is saving money and boosting profits.

The occupations most likely to be affected would be where entry-level work is replaced with automation, Bank of America economists wrote on Oct. 22. So far, however, businesses loaded with white-collar workers, such as those in the information, finance, and professional services sector, have seen job growth in tandem with increased AI usage, they wrote.

"I'm reticent to say it's AI just yet," said Allison Shrivastava, economist with Indeed Hiring Lab in Saratoga Springs, New York, who said the tech sector has been retrenching since a 2022 peak. "It has the potential to impact the labor market, but I don't think we're seeing that strong an impact right now."

LOW-HIRING, LOW-FIRING DOLDRUMS

With the U.S. government shut, data is at a premium. Weekly state jobless figures so far do not show a measurable surge in layoffs, but job growth remains subdued. Payroll provider ADP on Tuesday estimated an increase of 14,250 jobs in the four weeks ended Oct. 11.

Despite the headlines, economists say the labor market is stuck in a "low-hiring, low-firing phase", with firms quietly trimming headcount by not replacing vacated roles.

If layoffs accelerate, they could further weaken consumer confidence and the broader U.S. economy, already under strain from tariffs and inflation above Federal Reserve targets. Fed officials concerned about the job market worry the “low-hiring, low-firing” environment could slip towards faster layoffs.

"I describe this as a 'hold-your-breath' environment," Shrivastava said. "'Low-hire, low-fire' almost makes it feel like we're in this new equilibrium, where really companies are just holding their breath, trying to figure out what's going on."