Amazon layoffs spill into Canada as tech giant terminates as many as 10,000 workers

Amazon's Canadian employees appear to be getting caught up in the largest round of layoffs in the tech giant's history, amid a wave of global job cuts across the tech sector.

Several Amazon employees across Canada posted on LinkedIn that they had lost their jobs shortly after The New York Times reported Monday that the Seattle-based e-commerce juggernaut was expected to lay off some 10,000 employees across its devices, retail and human resources departments.

Job cuts were confirmed Wednesday by Dave Limp, Amazon's senior vice-president of devices and services. He did not state the number of employees impacted.

After a deep set of reviews, we recently decided to consolidate some teams and programs. One of the consequences of these decisions is that some roles will no longer be required," Limp said in a public message to staff.

Amazon's decision was the result of an unusual and uncertain macroeconomic environment," Limp said.

Several tech companies have seen their valuations plummet from historic highs during the COVID-19 pandemic when a vast number of the population lived online. Rising inflation, soaring global interest rates and looming recession have lead to investor hesitation and the drying up of once free-flowing venture capital money.

Amazon is just the latest technology company to report job losses. Others include Meta Inc. (Facebook), Shopify, Netflix and Twitter. Local startups including Clearco, Hootsuite and Wealthsimple have also made cuts in recent months.

According to Amazon's LinkedIn page, the company has approximately 19,929 employees based in Canada. But the number of employees laid off is unclear and Amazon did not respond to the Star for comment.

Mounting layoffs at tech companies are unlikely to be a harbinger of trouble in Toronto's technology sector, say Canadian tech industry experts.

The layoffs will mean that more talent will be looking to enter different tech spaces, forcing employees to be more innovative in their job search and the spaces they work in, said Courtney Radsch, a senior fellow at the Centre for International Governance Innovation, a think tank focused on technology and international governance.

It's going to be a challenge at first for people who are looking to maintain the same salaries and benefits they got at the major big tech companies. There will be a lot more competition for those jobs," Radsch said.

But a lot more talent is going to be out on the market - people who are available to work at startups or in the broader economy, which includes lots of tech jobs in civil society and academia and non-profit organizations."

One of the biggest challenges in the tech sector over the past decade has been the consolidation of a few powerful players and their ability to buy up competitors. I think that really stifles innovation," Radsch said. This could end up being a good thing for the economy and society more broadly."

The layoffs do not spell doom for Toronto's tech industry, agreed Ning Su, an associate professor at Western University's Ivey School of Business.

On the one hand, the slowdown will spill over to tech sectors in Canada and markets around the world," Su said. But in Canada this means there will be more talent that's available, which could be a great opportunity for startups and other companies to access the talent."

A recent report from the Information and Communications Technology Council, a not-for-profit organization offering labour policy advice, predicted employment in the Canadian digital economy would reach 2.26 million by 2025, triggering demand for an additional 250,000 jobs.

Veteran tech investor Sunil Sharma, said he's already seeing the movement of more experienced tech professionals to smaller startups, which is a silver lining.

We're seeing this shift toward smaller companies now and a shift toward entrepreneurship itself. There are more startups that are comprised of employees of other larger tech companies," Sharma said.

There's a lot of opportunity within the tech sector, but it could mean moving from a large company to a smaller one where there might be significantly different financial compensation. But it could be a much more rewarding career with more potential in the future."

With files from Canadian Press.

Ghada Alsharif is a Toronto-based staff reporter for the Star. Reach Ghada via email: galsharif@torstar.ca