Hacker News Reader

Comment by g9yuayon | Hacker News Reader

Is there any theory on why Amazon decided to spread the cut over months of time instead of planning sufficiently and then having a decisive cut?

View on HN

It’s a cost-minimization strategy. I’m sure one of the 300+ economists at AMZN had to write a 6-pager on this question.

Layoffs are labor level reductions amid ongoing or expected periods of excess labor capacity. It’s almost a classic supply chain/operations management problem. Classically an Amazon core competence and problem at Amazon [1].

There are both shortage and excess costs to labor levels (ie. labor inventory) vs labor demand, combined consider as a supply-demand mismatch cost. To minimize this cost is to create a perfectly coordinated supply chain/inventory system through minimizing shortages and excesses.

Statistically speaking, it is incredibly difficult for a company to perfectly return to that optimal level of supply in 1 single action because the optimal level is difficult to measure in the short run. Therefore, by monitoring supply and demand of labor over time, you are able to make more precise adjustments to return to optimal level of labor.

Sadly, this strategy implies Amazon likely used a lower percentile estimate of required labor reductions for initial layoffs, meaning the mean/median estimate of required labor reductions is likely higher than already announced.

[1] https://www.vox.com/recode/23170900/leaked-amazon-memo-wareh...

To maximize morale pain so more people leave without having to pay them severance. If you knew you were at risk of being laid off sometime in the next few months, wouldn't you start looking now?

But doesn't this also mean you're more likely to loose your best employees (who can more easily find a job elsewhere) and retain your worst ones (who'll consider an unpleasant Amazon better than any alternative)?

Where are they going to go at this point? Not many places hiring that will pay more than Amazon.

One question I do have is since H1B is technically only allowed when there is not a citizen who can complete the job, does that mean that people on visas would be laid off first or does that not go into consideration for the layoffs.

Google, Apple, Microsoft?

There is no such requirement to employ an H1B. The only requirement is to pay atleast prevailing wage for the role you're hiring for.

This risks the dead sea effect though.

https://medium.com/geekculture/the-dead-sea-effect-d71df1372...

I think Amazon is being honest and the rest of the industry will also being doing future lay offs.

I don't understand how everyone can do this at the same time and it's not connected and planned.

It is connected. Biden asked wall street / fortune 500 companies to freeze / slow hiring / wage increases. This is part of a larger plan.. When the new prime minister of England presented a budget with a taxcut she was shortly shown the door.

Do you have a link to a news article from a reputable organization that said President Biden asked for this?

https://www.google.com/amp/s/finance.yahoo.com/amphtml/news/...

Biden's name isn't uttered in this article at all. Nor are there any statements from any Fed or government officials saying they're trying to do this. Any such suggestions are interpretations being made by independent analysts trying to read the tea leaves.

Try again.

I saw him say it on tv as well. I'll be your source and if that is not enough then you will have to live in a world where others know more than you. At some point the information will reach you.

That's not the way to persuade people of your correctness. If you make a claim, the burden is on you to support it with facts and evidence.

Otherwise, people will naturally treat it with the skepticism it deserves. Or, put less charitably, as the nonsense that it is.

A lot of people still haven't found that special source that they trust to tell them the world is not flat.

I'm not looking to persuade that group or yourself. I'm happy to leave you in your own worldview. My original comments were for others. If you want someone to care enough to persuade you, pay them.

> don't understand how everyone can do this at the same time and it's not connected and planned.

Oh! It’s very much connected like this https://www.vanityfair.com/news/business/2014/04/apple-googl...

squeeze maximum efficiency out of people who are going to work even harder hoping to save their job only to get laid off anyway

Incompetence?

Reply on news.ycombinator.com