UPS announced that it will reduce its workforce by 30,000 in 2026. employees and will close another 24 facilities.
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Last year, the company eliminated 48,000 jobs. jobs and closed operations in 93 facilities, aiming to save approximately USD 3 billion. this year.
The decision results from the desire to switch to higher-margin deliveries. Last January, UPS announced it would accelerate a plan to cut millions of low-profit deliveries for Amazon, its largest customer and growing delivery rival, calling the activity “extremely dilutive” to margins.
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“We are reducing the number of shipments by a million a day”
“We are in the final six months of our Amazon Accelerated Package Reduction Plan and intend to reduce the number of packages by another million per day throughout 2026 while we continue to reconfigure our network,” CEO Carol Tome said on the call.
See also: Amazon is preparing the largest layoffs in the company's history
According to the 2024 report, UPS employed approximately 490,000. employees, including almost 78 thousand in the management staff.
The company also aims to rebuild profitability and stabilize volumes after the end of duty-free, low-value e-commerce shipments in the US (so-called de minimis shipments).
Not only UPS. Amazon is preparing the largest layoffs in the company's history
Amazon, UPS's largest customer and one of the e-commerce giants, is also planning another round of mass layoffs. Employment reductions may affect several thousand corporate employees.
The reductions are expected to affect key divisions of the company, including Amazon Web Services, Prime Video, retail and human resources, although details are subject to change.
The company attributed previous layoffs to the introduction of innovative technologies based on artificial intelligence (AI). In an internal letter to employees, management described AI as “the most revolutionary technology since the internet.”
However, Amazon CEO Andy Jassy explained during the third quarter earnings conference call that job cuts were not motivated solely by financial considerations or the development of AI.
Source: Reuters
