The economy is worried for consumers and investors, and the former has punished tech company stocks in recent weeks by selling them off.
Consumers are heavily impacted by inflation, which is at its highest level in 40 years. This inflation affects the prices of almost all products and services. That urges caution. Aggressive central bank interest rate hikes to combat these price increases threaten to plunge the economy recessionsay some economists.
But for Jeff Bezos, the US economy is already in recession. Founder of Amazon (AMZN)- Get a Free Report It is well positioned to take the pulse of the economy as the e-commerce giant is a juggernaut serving consumers and businesses alike.
“Some people say that maybe we are already in a recession. Do you think we are in one?” Bezos was asked when one interview with CNN.
“I don’t know why we’re technically in recession economists arguing that — they have some technical definition,” Bezos replied. “But I can tell you that the economy is not looking good right now. Things are slowing down.
Then he added: “It is likely that we are not in a recession now but we will probably be in one very soon.”
‘Quite a Few Risks Off the Table’
Bezos was then asked what advice he would give to small businesses in these difficult times.
“My advice to people, small business owners take some risks off the table. If you want to make a purchase, maybe slow down the purchase a little bit,” said the billionaire. “If you’re an individual and you’re thinking about buying a new big screen TV, maybe slow it down and keep the cash, see what happens. The same thing with a refrigerator, a new car, let’s take some risks off the table.”
“If you are a small business, maybe delay some capital purchases: do you need a new piece of equipment? Maybe it can wait a little bit, have some cash on hand; just a little bit of reducing the risk can make a difference for the small business.”
When asked how long he thought the recession would last, the businessman said it was “very challenging” to make predictions but asked people to “hope for the best and prepare for the worst.”
This advice is similar to that of Bezos had already been given on October 18 and the only difference is that for the billionaire there is no doubt that we are in a recession.
“Yep, the probability in this economy tells you to batten down the hatches,” Bezos posted on Twitter on October 18.
This is a call for belt-tightening recipes from his company. Amazon began Tuesday to implement massive job cuts in response to an economic slowdown likely to turn into a recession in the coming months.
The company is expected to cut 10,000 jobs, or about 3% of the company’s workforce, an unprecedented move in its history.
Whole Foods owners have notified affected employees. Based on testimonials and posts on social networks, the reduction in staff affects several divisions, including Alexa and Luna’s cloud game unit.
“Unfortunately, I was affected by the layoff today along with 10,000 other Amazon people. It’s very difficult for all of us and I’m still trying to navigate this, while being limited by the timeline on #visa,” said Shivani Parate on LinkedIn, who is a former Software Development engineer on Amazon. “I’m just grateful for the time I spent at Amazon, learning and collaborating with some of the brightest people in the industry.”
“I am looking for a Software Engineer / Machine Learning role immediately. Thanks in advance for any connections, advice or opportunities you can offer! Message me with instructions or contact me at [email protected] Thanks again!”
The e-commerce giant is not the only one implementing massive layoffs to limit the damage of the current economic situation. Platform Meta proclaim last week eliminated 11,000 jobs, or 13% of the group’s 87,000 employees. It is the first cut in the history of Facebook since its creation in 2004.
“In this new environment, we need to be capital more efficient,” Meta’s CEO Mark Zuckerberg told employees. “We have cut costs throughout our business, including scaling back budgets, reducing perks, and shrinking our real estate footprint. We are restructuring the team to improve our efficiency.”
Downsizing has spread to the tech and crypto sectors: Twitter, Lyft, Coinbase, Stripe, Microsoft have cut jobs today.
Alphabet, Apple and others have hiring freezes or slow hiring rates.