Amazon aims to automate over 500,000 jobs
In the last twenty years, no company has had a greater impact on the American workplace than Amazon. In its rise to become the nation’s second-largest employer, it has recruited hundreds of thousands of warehouse workers, established a vast network of contract drivers, and innovated the use of technology to hire, monitor, and manage employees. Interviews and a collection of internal strategy documents examined indicate that Amazon executives are convinced the company is on the brink of a significant transformation in the workplace: substituting over half a million jobs with robots. Amazon’s US workforce has increased more than threefold since 2018, reaching nearly 1.2 million employees. However, Amazon’s automation team anticipates that the company can circumvent the need to hire more than 160,000 individuals in the United States by 2027. This would result in a savings of approximately 30 cents for every item that Amazon selects, packages, and delivers to its customers. Executives informed Amazon’s board last year of their aspirations for robotic automation to enable the company to refrain from increasing its US workforce in the years ahead, despite anticipating a doubling of product sales by 2033. That would equate to over 600,000 individuals whom Amazon did not require to employ. At facilities designed for superfast deliveries, Amazon is endeavoring to establish warehouses that utilize minimal human labor.
Documents reveal that Amazon’s robotics team aims to automate 75 percent of its operations. Amazon is so convinced that this automated future is imminent that it has begun formulating strategies to address the repercussions in communities that could face job losses. Documents reveal that the company has contemplated establishing an image as a “good corporate citizen” by increasing its involvement in community events like parades and Toys for Tots. The documents suggest refraining from using terms such as “automation” and “A.I.” in discussions about robotics. Instead, they recommend employing phrases like “advanced technology” or substituting the word “robot” with “cobot,” which conveys a sense of collaboration with humans. Amazon stated that the documents reviewed were incomplete and did not reflect the company’s overall hiring strategy. Kelly Nantel stated that the documents represented the perspective of a single group within the company and highlighted that Amazon intended to hire 250,000 individuals for the upcoming holiday season, although the company did not disclose how many of those positions would be permanent. Amazon clarified that it is not requiring executives to refrain from using specific terms, and emphasized that community involvement is not connected to automation.
Amazon’s plans may significantly affect blue-collar jobs across the nation and could act as a blueprint for other major employers such as Walmart and UPS. The company revolutionized the US workforce by generating a significant demand for warehousing and delivery jobs. However, as it paves the path for automation, those positions may evolve to be more technical, offer higher salaries, and become increasingly rare. “Nobody else has the same incentive as Amazon to find the way to automate,” stated Daron Acemoglu. “Once they determine a profitable approach, it will inevitably extend to others as well. If the plans pan out, one of the biggest employers in the United States will become a net job destroyer, not a net job creator,” Mr. Acemoglu said. They included working papers that illustrate how various segments of the company are managing its ambitious automation initiative, along with formalized plans for the department comprising over 3,000 corporate and engineering employees who primarily focus on developing the company’s robotic and automation operations. Udit Madan, who leads worldwide operations for Amazon, stated in an interview that the company has a longstanding practice of utilizing savings from automation to generate new employment opportunities, including a recent initiative to establish additional delivery depots in rural regions. “That you have efficiency in one part of the business doesn’t tell the whole story for the total impact it might have,” he said, “either in a particular community or for the country overall.”
For years, Jeff Bezos, Amazon’s founder and longtime chief executive, urged his staff to think big and imagine what it would require to fully automate its operations, according to two former senior leaders involved in the work. In 2012, Amazon made its initial significant move into robotic automation by acquiring the robotics manufacturer Kiva for $775 million. The acquisition significantly altered Amazon’s operations. Workers no longer traversed miles through a warehouse. Instead, robots resembling large hockey pucks transported towers of products to employees. The company has since developed a coordinated system of robotic programs that connect seamlessly with one another, akin to Legos. It has concentrated on converting the expansive, essential warehouses that select and package the items customers purchase with a simple click. Last year, Amazon inaugurated its most advanced warehouse, a facility located in Shreveport, La., serving as a model for future robotic fulfillment centers. Once an item is placed in a package, it is seldom touched by a human again. Documents reveal that the company employs a thousand robots in Shreveport, resulting in a workforce reduction of a quarter compared to the previous year, had automation not been implemented. Next year, with the introduction of more robots, it anticipates employing approximately half the number of workers as it would in the absence of automation. “With this major milestone now in sight, we are confident in our ability to flatten Amazon’s hiring curve over the next 10 years,” the robotics team wrote in its strategy plan for 2025.
Amazon intends to replicate the Shreveport design across approximately 40 facilities by the conclusion of 2027, beginning with a substantial warehouse that has recently opened in Virginia Beach. It has commenced the process of renovating outdated facilities, including one located in Stone Mountain near Atlanta. The facility currently employs approximately 4,000 workers. However, following the installation of the robotic systems, it is anticipated that the operation will handle 10 percent more items while requiring up to 1,200 fewer employees, as indicated by an internal analysis. Amazon stated that the final head count was subject to change. The documents indicate that following the completion of the Stone Mountain retrofit, there will be a reduced need for workers, with a greater reliance on temporary employees rather than full-time staff. (Amazon stated that certain facilities would see an increase in employees following retrofitting.) As they prepare for potential job cuts, certain employees involved in the transition have devised strategies to “control the narrative” in Georgia. Their focus is on promoting new technician jobs and “innovation to give local officials a sense of pride,” according to documents. Amazon stated that local officials were aware of the retrofit and that its participation in local initiatives was not connected.
In the wake of the pandemic, Amazon’s automation initiatives gained urgency as the surge in online shopping prompted an unprecedented hiring spree, marking a significant moment in the annals of corporate America. Mr. Madan stated that the company had initiated a comprehensive redesign of its standard warehouses. In March 2024, during a presentation to the Amazon board, executives involved in the automation plans faced pressure from the directors to achieve greater results with reduced resources. By the fall, the robotics team had achieved significant advancements. The automation plan’s cost was lowered to under $10 billion, while the anticipated savings rose to $12.6 billion for the period from 2025 to 2027. Andy Jassy, who assumed the role of chief executive in July 2021 when Mr. Bezos stepped down, has been advocating for cost reductions throughout the e-commerce sector. “For years and years, they were really investing for growth, and in the last three years the company’s focus has shifted to efficiencies,” said Justin Post. Robotics “really does make a big difference to the bottom line.” Amazon has stated that it employs a million robots worldwide, asserting that the individuals responsible for their maintenance will represent the future of employment. Both hourly workers and managers must enhance their understanding of engineering and robotics as Amazon’s facilities increasingly resemble advanced factories. At the Shreveport facility, over 160 individuals are employed as robotics technicians, earning a minimum of $24.45 per hour. The majority of Shreveport’s 2,000 employees are regular hourly workers, with starting pay set at $19.50. “Training workers for these new roles is something close to my heart,” Mr. Madan said. He highlighted that nearly 5,000 individuals have participated in Amazon’s mechatronics apprenticeship program since 2019. “It can be a very successful path,” he stated. Concerns have been raised that automation may disproportionately impact people of color, especially given that Amazon’s warehouse workforce is approximately three times more likely to be Black compared to the average American worker.
The situation may unfold at the warehouse in Stone Mountain. This summer, a 28-year-old Black man residing near the facility took to Reddit in search of assistance in securing employment at Amazon. The source stated that he had successfully completed the initial screening for a job earlier this year, but that there were no available time slots for the final appointment to verify his identification and conduct a drug test. He had not encountered a single job listing there for five months. He stated that he consistently monitors Amazon’s hiring website, even employing a computer tool that refreshes the site every 10 seconds. The job seeker was unaware that, despite Amazon’s current stance on layoffs at the Stone Mountain facility, the company intends to gradually reduce its workforce of 4,000 employees through attrition. Despite being just five years old, the Stone Mountain warehouse has already become outdated. Efforts are in progress to convert it into a robotic facility that, in the long run, may require a thousand fewer employees.
