New Delhi: Amid ongoing layoffs in tech giants, Amazon has asked some of its Indian employees to resign voluntarily by November 30. The company also offers monetary benefits to employees who opt for it.
Under the Voluntary Separation Program (VSP), the company is offering 22 weeks Base Pay, a one-week base salary for every six months of service up to a maximum benefit of 20 weeks, and six-month medical insurance coverage.
However, to avail of the benefits, the employees have to submit the applications before 6:30 am IST on November 30, 2022.
Amazon is removing thousands of employees as some of the roles are no longer needed in the company.
In an email sent to the employees, Amazon’s Senior Vice President, David Limp wrote, ‘As you know, we continue to face an unusual and uncertain macroeconomic environment. In light of this, we’ve been working over the last few months to further prioritize what matters most to our customers and business. After a deep set of reviews, we recently decided to consolidate some teams and programs. One of the consequences of these decisions is that some roles will no longer be required’.
Companies implement hiring freezes
As recession is looming on the entire world, especially, in western countries, companies are not only implementing hiring freezes but also going for mass layoffs. Many big companies including Amazon, Twitter, and Meta are getting ready for the possible recession.
Though people are facing difficulties in finding jobs, it is not abnormal as whenever economy passes through a bust period, people usually lose jobs.
However, it is just a matter of time. Once the bust period – that last for a few months – ends economy enters into a boom period wherein commercial activities increase significantly and open new opportunities for skilled employees.
Reasons for looming recession threat
Though there are multiple reasons for the looming recession threat, the major ones are the COVID pandemic and the Russia-Ukraine war.
During the COVID pandemic, governments distributed money to their citizens as the entire world was fighting the deadly virus either in hospitals or by staying in lockdown.
Although the distribution of money during the period was needed, it created a demand-supply mismatch as people got money in their hands without an actual supply of goods in the markets. It resulted in a spike in inflation.
Many nations after coming out of the lockdown wanted to address the issue of inflation but the Russia-Ukraine war made the situation worse.
Due to the war, the supply chain was disrupted thereby pushing the price even higher, especially in Europe and other western countries.
Now, to control the rising inflation, the central banks of many countries are raising interest rates. It is the need of the hour but it causes slowdown in the economy.
However, it is just a matter of months. Once inflation begins to drop, economies will be back on track.
