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Comment by adoxyz | Hacker News Reader

Laying people off reduces one of the biggest costs to an organization, thus making it more profitable (even if in the short term), thus the stock price rises. Stocks are always forward looking and investors believe that by cutting down costs and re-focusing will make amazon worth more in the future.

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How can a company be more profitable with less workers if the workers are the source of the profits?

The workers aren't the source of profits in all cases.

Eg, a musician is a worker, but once they've written a song that you now iwn, you can sell infinite licenses to it, regardless of whether the musician is still being paid

This is why, these days, musicians all make their money by touring. People will pay over and over to see the same person play the same song in person.

But if you hire that musician, you can create more products you can license. The worker generates more revenue streams for you. This is why streaming companies are leasing soundstage space, to create more stuff to license themselves.

But not all types of music are equally in demand. If consumer tastes change, it would obviously make sense to layoff musicians trained to make music for a genre that nobody wants to buy anymore.

That's one way of thinking which IMO is a cold way to look at the world. I would say its just simply nicer to retrain your staff to meet your goals versus cutting them off and finding new staff all the time. Too bad nice typically goes against profits in this economy.

Perhaps the conclusion is that (at least some of) the workers aren’t the source of the profits.

That’s the point, they’re laying off unprofitable orgs. What makes you think that more workers translates to more profitable?

Alexa lost $10 billion last year. Those workers were the source of losses through their salary.

By this logic, every company should always maximize the number of employees they have, regardless of whether they have anything useful to do.

Apparently they're not the source of profit:

```Amazon initiated a broad cost-cutting review to pare back on units that were unprofitable```

Seems like a better solution would have been to shift that labor to more productive uses that can generate revenue, than to throw some of the oars off your boat to go faster.

Not everyone is fungible. How can you repurpose recruiters effectively when you're not recruiting? How can you repurpose well-paid robotics engineers when you've realized you have over-invested?

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