After Amazon, UPS announces 48,000 major layoffs! CEO: We are constantly discovering opportunities to cut costs.

United Parcel Service (UPS) disclosed in its earnings report on Tuesday that the company has cut 48,000 management and operations positions, including 14,000 management roles and 34,000 operations roles. The company stated these reductions were achieved through layoffs and voluntary buyouts.

This round of layoffs exceeded UPS's previously announced plans. In April this year, UPS said it would cut about 20,000 operations jobs to restructure its U.S. network, expecting to save around $1 billion; in January 2024, UPS announced plans to cut about 12,000 management positions.

UPS stated the company is in a favorable position for the upcoming holiday season; this year's restructuring measures have already brought about $2.2 billion in cost savings. The company also benefited from increased automation and plans to reduce the hiring of temporary workers during the fall and holiday periods.

Despite UPS's third-quarter profit and revenue declining year-over-year, the results still beat market expectations, helped by cost-cutting and job reductions. This drove the company's stock price up nearly 7% in Tuesday’s midday U.S. trading.

UPS CEO Carol Tomé stated:

We continually find opportunities to reduce costs. We are well positioned to deliver the most efficient peak season operations in the company's history.

Tomé faces pressure to reverse the company's prolonged stock weakness, with particular pressure from employees and retirees. Due to UPS’s unique shareholder structure, they have considerable influence over company affairs. According to earlier media reports, this group significantly affects management decisions.

Tomé is the first externally appointed CEO in UPS history. She was formerly CFO of Home Depot and served for many years as a UPS board member. She took over as CEO during the COVID pandemic, adjusting the company’s business model from pursuing volume growth to pursuing high-margin packages.

UPS CFO Brian Dykes pointed out:

We need less variable capacity, fewer leased airplanes, fewer rental vehicles, and fewer seasonal workers. This enables us to operate a more efficient network.

This UPS staffing optimization closely followed the company's decision to reduce the volume of business from Amazon, which was previously UPS’s largest customer. In the third quarter, UPS’s business volume related to Amazon fell 21.2%. UPS expects the average daily parcel volume during this year’s peak season to be lower than last year, mainly because the company continues to reduce Amazon shipments.

As part of the cost-saving plan, UPS has closed 93 owned and leased regular operations buildings in 2025, and expects to save about $3.5 billion year-over-year throughout the year. Tomé added that UPS expects Amazon-related business volume will continue to decline, and more facilities will be closed within the year.

Layoff news from UPS and Amazon has followed one after the other. Amazon, America’s second largest employer, is embarking on its largest round of layoffs in history—not only 10% of white-collar jobs, but potentially tens of thousands of blue-collar positions may also be at risk. According to media reports:

The ultimate goal of the Amazon Robotics team is to achieve 75% operational automation. This plan, by 2033, would double sales without adding over 600,000 new employees, and could save the need to hire about 160,000 workers by 2027, causing significant impact on blue-collar jobs.

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