Amazon Plans to Replace 160,000 Jobs with in Workforce of 1.2mn Robots, Aiming
to Automate 75% of Operations
Internal documents show the company that
changed how people shop has a far-reaching plan to automate 75 percent of its operations.
Internal Amazon documents reveal the company’s sweeping
plan to replace more than 500,000 jobs with robots over the next decade as
it seeks to automate up to 75% of its operations.
Amazon’s U.S. workforce has tripled since 2018 to
about 1.2 million, but the company’s automation division projects that new robotic
systems could help avoid hiring over 160,000 workers by 2027—and more
than 600,000 by 2033—while doubling sales volumes. The move could save roughly
30 cents per item picked, packed, and delivered.
At its prototype facility in Shreveport, Louisiana,
robots already perform most fulfillment tasks, cutting
required labor by nearly half. Amazon plans to replicate
this robotic warehouse model across 40 facilities by 2027, including a new
site in Virginia Beach and retrofits like the Stone Mountain center near Atlanta, where headcount may drop by over 1,000.
The company’s internal strategy papers also discuss
ways to manage public perception, suggesting the use of softer terms like “advanced
technology” and “cobots” (collaborative robots)
instead of “automation” or “AI.”
While Amazon says the documents reflect only one group’s
views and that it will still hire 250,000 workers for the upcoming holiday season,
experts warn of a larger shift in U.S. employment patterns. MIT economist Daron
Acemoglu noted that if Amazon succeeds, it could turn “one of the biggest
employers in the United States into a net job destroyer,” setting a template
for companies like Walmart and UPS.
Amazon says automation will also create higher-skilled
roles, including robotics technicians who earn around $24.45 per hour,
and cites its mechatronics apprenticeship program, which has trained nearly
5,000 workers since 2019. Still, the transition raises social and racial equity
concerns, as a large share of Amazon’s warehouse workforce are people of color, who may face disproportionate job losses.
Key Takeaways:
·
Goal: Automate 75% of Amazon’s operations.
·
Jobs Affected: Over 600,000 positions could
be replaced or avoided by 2033.
·
Prototype Model: Shreveport robotic warehouse cuts
human labor by 50%.
·
Planned Expansion: 40+ fully
automated facilities by 2027.
·
Corporate Strategy: Rebrand “robots”
as “cobots” to manage public messaging.
·
Broader Impact: Could reshape U.S. blue-collar employment
and set an automation precedent for other major employers.
Over
the past two decades, no company has done more to shape the American workplace than
Amazon. In its ascent to become the nation’s second-largest employer, it has hired
hundreds of thousands of warehouse workers, built an army of contract drivers and
pioneered using technology to hire, monitor and manage employees.
Now,
interviews and a cache of internal strategy documents viewed by The New York Times
reveal that Amazon executives believe the company is on the cusp of its next big
workplace shift: replacing more than half a million jobs with robots.
Amazon’s
U.S. work force has more than tripled since 2018 to almost 1.2 million. But Amazon’s
automation team expects the company can avoid hiring more than 160,000 people in
the United States it would otherwise need by 2027. That would save about 30 cents
on each item that Amazon picks, packs and delivers to customers.
Executives
told Amazon’s board last year that they hoped robotic automation would allow the
company to continue to avoid adding to its U.S. work force in the coming years,
even though they expect to sell twice as many products by 2033. That would translate
to more than 600,000 people whom Amazon didn’t need to hire.
At
facilities designed for superfast deliveries, Amazon is trying to create warehouses
that employ few humans at all. And documents show that Amazon’s robotics team has
an ultimate goal to automate 75 percent of its operations.
Amazon
is so convinced this automated future is around the corner that it has started developing
plans to mitigate the fallout in communities that may lose jobs. Documents show
the company has considered building an image as a “good corporate citizen” through
greater participation in community events such as parades and Toys for Tots.
The
documents contemplate avoiding using terms like “automation” and “A.I.” when discussing
robotics, and instead use terms like “advanced technology” or replace the word “robot”
with “cobot,” which implies collaboration with humans.
Amazon
said in a statement that the documents viewed by The Times were incomplete and did
not represent the company’s overall hiring strategy. Kelly Nantel, a spokeswoman
for Amazon, said the documents reflected the viewpoint of one group inside the company
and noted that Amazon planned to hire 250,000 people for the coming holiday season,
though the company declined to say how many of those roles would be permanent.
Amazon
also said that it’s not insisting executives avoid certain terms, and that community
involvement is unrelated to automation.
Amazon’s
plans could have profound impact on blue-collar jobs throughout the country and
serve as a model for other companies like Walmart, the nation’s largest private
employer, and UPS. The company transformed the U.S. work force as it created a booming
demand for warehousing and delivery jobs. But now, as it leads the way for automation,
those roles could become more technical, higher paid and more
scarce.
“Nobody else has the same incentive as Amazon to
find the way to automate,” said Daron Acemoglu, a professor at the Massachusetts
Institute of Technology who studies automation and won the Nobel Prize in economic
science last year. “Once they work out how to do this profitably, it will spread
to others, too.”
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.
The
Times viewed internal Amazon documents from the past year. They included working
papers that show how different parts of the company are navigating its ambitious
automation effort, as well as formalized plans for the department of more than 3,000
corporate and engineering employees who largely develop the company’s robotic and
automation operations.
Udit
Madan, who leads worldwide operations for Amazon, said in an interview that the
company had a long history of using the savings from automation to create new jobs,
such as a recent push to open more delivery depots in rural areas.
“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.”
A Template for the Future
For
years, Jeff Bezos, Amazon’s founder and longtime chief executive, pushed his staff
to think big and envision what it would take to fully automate its operations, according
to two former senior leaders involved in the work. Amazon’s first big push into
robotic automation started in 2012, when it paid $775 million to buy the robotics
maker Kiva. The acquisition transformed Amazon’s operations. Workers no longer walked
miles crisscrossing a warehouse. Instead, robots shaped like large hockey pucks
moved towers of products to employees.
The
company has since developed an orchestrated system of robotic programs that plug
into each together like Legos. And it has focused on transforming the large, workhorse
warehouses that pick and pack the products customers buy with a click.
Amazon
opened its most advanced warehouse, a facility in Shreveport, La., last year as
a template for future robotic fulfillment centers. Once an item there is in a package, a human barely
touches it again. The company uses a thousand robots in Shreveport, allowing it
to employ a quarter fewer workers last year than it would
have without automation, documents show. Next year, as more robots are introduced,
it expects to employ about half as many workers there as it would without 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
plans to copy the Shreveport design in about 40 facilities by the end of 2027, starting
with a massive warehouse that just opened in Virginia Beach. And it has begun overhauling
old facilities, including one in Stone Mountain near Atlanta.
That
facility currently has roughly 4,000 workers. But once the robotic systems are installed,
it is projected to process 10 percent more items but need as many as 1,200 fewer
employees, according to an internal analysis. Amazon said the final head count was
subject to change.
The
documents also show that after the Stone Mountain retrofit is done, it should need
fewer workers and depend more on temporary employees than full-time staff. (Amazon
said some facilities would have more employees after they were retrofitted.)
Bracing
for job cuts, some employees working on the transition have strategized ways to
“control the narrative” in Georgia by focusing on new technician jobs and “innovation
to give local officials a sense of pride,” documents show.
Amazon
said that local officials knew about the retrofit and that its involvement in local
efforts was unrelated.
A Million Robots
Amazon’s
automation plans became more pressing after the pandemic’s surge in online shopping
sent Amazon on a hiring spree unrivaled in the history
of corporate America. Mr. Madan said the company had embarked on a complete redesign
of its typical warehouses.
In
March 2024, when executives working on the automation plans gave a presentation
to the Amazon board, the directors pressed them to do more with less. By the fall,
the robotics team had made progress. It reduced the cost of the automation plan
to less than $10 billion, and increased the expected savings to $12.6 billion from
2025 to 2027.
Andy
Jassy, who took over as chief executive in July 2021 when Mr. Bezos stepped aside,
has pushed to cut costs across the e-commerce business. “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, a Wall Street analyst at Bank of
America who has covered Amazon for two decades. Robotics “really does make a big
difference to the bottom line.”
Amazon
has said it has a million robots at work around the globe, and it believes the humans
who take care of them will be the jobs of the future. Both hourly workers and managers
will need to know more about engineering and robotics as Amazon’s facilities operate
more like advanced factories.
At
the Shreveport facility, more than 160 people work as robotics technicians, and
they make at least $24.45 an hour. Most of Shreveport’s 2,000 employees are regular
hourly workers, whose pay starts at $19.50.
Training
workers for these new roles is “something close to my heart,” Mr. Madan said. He
pointed to data that almost 5,000 people had gone through Amazon’s mechatronics
apprenticeship program since 2019. “It can be a very successful path,” he said.
There
are concerns automation could affect people of color particularly
hard because Amazon’s warehouse workers are about three times as likely as a typical
American worker to be Black.
That
dynamic could play out at the warehouse in Stone Mountain.
This
summer, a 28-year-old Black man who lived near the facility posted on Reddit looking
for help landing a job at Amazon. The man, who in an interview declined to be named
to protect his privacy, wrote that he had passed the initial screening for a job
earlier this year, but that there were no time slots available for the final appointment
to check his identification and do a drug test. And he hadn’t seen a single job
listing there for five months.
He
said he checks Amazon’s hiring website constantly, even using a computer tool that
refreshes the site every 10 seconds.
The
job hunter did not know that even though Amazon is not planning layoffs at the Stone
Mountain facility, it plans over time to shrink its 4,000-employee work force through
attrition.
Though
it is only five years old, the Stone Mountain warehouse is already outdated. Work
is underway to transform it into a robotic facility that, eventually, could need
a thousand fewer workers.