Amazon says it didn't cut people because of money. But because of 'culture'
cnn.comThere's been a lot of debate around Amazon's hiring practices, particularly given the conflicting data and statements from the company. A core issue seems to be that Amazon has alienated a significant portion of its domestic engineering talent pool. Many experienced engineers have left, and others seem unwilling to return, even when offered higher-level roles. I personally was an L7 engineer and turned down a boomerang offer.
In response, Amazon appears to be increasingly turning to H-1B workers - especially from countries where the company’s reputation hasn't soured as much.
Example: https://h1bgrader.com/h1b-sponsors/amazon-dot-com-services-l...
While these engineers may be less experienced, they're often more willing to accept lower compensation, due in part to discrepancies in wage data reported by the Department of Labor. For example, the BLS wage data, which sets a $115k cap for certain wage codes, has led to a misalignment in what’s considered a "fair wage" enabling companies like Amazon to pay these workers below actual market rates.
This reliance on overseas talent seems to be more than just a cost-saving measure; it also reflects Amazon's ongoing struggle with high turnover among its U.S. engineering staff. The company’s well-documented high attrition rates, as highlighted in reports like this one from Forbes - https://www.forbes.com/sites/edwardsegal/2022/10/24/amazon-r... - shed light on the challenges Amazon faces in retaining domestic engineers.
The LinkedIn data also supports this trend.
Candidly, it seems that Amazon has burned too many bridges with U.S.-based engineers, forcing the company to increasingly rely on a less experienced labor pool from abroad in order to maintain its operations, despite being an American based, publicly traded company.
From my understanding, the last budget bill passed (called the big beautiful bill by some) had changes to section 174. Specifically that software R&D could once again be immediately fully expensed in the year incurred rather than amortized over several years SO LONG AS its a US based expense. Non US based R&D expenses still need to be amortized, and over an ugly 15 year period.
What significant changes to section 174 were made in the big beautiful bill?
Key Changes The bill created a new Section 174A that restores immediate deductibility for domestic research and experimental (R&E) expenditures, largely reversing the Tax Cuts and Jobs Act requirement that had forced companies to capitalize and amortize all R&E expenses starting in 2022.
Domestic vs. Foreign Treatment:
Starting with tax years beginning after December 31, 2024, businesses may immediately deduct domestic R&E expenditures in the year they are paid or incurred
Foreign R&E expenditures must continue to be capitalized and amortized over 15 years under the original Section 174
Retroactive Relief Options:
The new rules permit taxpayers to deduct previously capitalized and unamortized domestic R&E expenditures over a one- or two-year period, and small businesses may opt to apply new Section 174A going back to 2022 and file amended returns. Eligible small business taxpayers (generally those with average annual gross receipts during the preceding three years not exceeding $31 million) can retroactively expense R&E expenditures for taxable years beginning after December 31, 2021, by filing amended returns.
Alternative Treatment: Taxpayers may still elect to capitalize and amortize domestic R&E expenditures over a period of not less than 60 months, or elect to amortize them over a 10-year period.
This represents a major win for businesses conducting research and development, as the 2022-2024 capitalization requirement had created significant tax burdens and compliance complexity.
I'm not so sure.. many years of capitalized R&D expenses would eventually compound such that you would find a steady state. And in general all we're talking about here is whether or not a company is profitable and hence is taxed.. most of these companies make sure to spend almost all of what they make to avoid being profitable
It's not even H1Bs and not just Amazon. Amazon and most Big Tech companies have been shifting jobs overseas (via hiring freezes in the US and open headcount in India) for almost 4 years now.
In case you don’t mind sharing: What happened that soured relationships between Amazon and domestic engineers?
what happens to that strategy now that h1bs are being targeted by the current administration?
They wait and the next administration reverses course.
I assume they will just open more offices overseas?
The link you posted is broken.
But I can tell you with fair certainty that Amazon's high turnover rate is NOT happening in their engineering departments, though. It's happening in their retail or business departments.
I'm kind of horrified by the rise of anti-immigrant rhetoric in engineering circles online and how normalized it's becoming. (Especially troubling how much Indians in particular are drawing ire). Is it really that much different if Amazon brings in a foreign worker to Seattle vs someone from Mississippi? Immigration restrictions are arbitrary and unfair, and in my mind any carveouts for them are a good thing.
> But I can tell you with fair certainty that Amazon's high turnover rate is NOT happening in their engineering departments, though.
Maybe you mean there hasn't been any change in their turnover recently, but the numbers (not to mention, the horror stories) I heard more than a decade ago from then-current and ex-AMZN folks were already pretty bad.
As an illustrative example, IIRC the average tenure is 21 months, which is just 3 months short of their first big RSU chunk (15%?) vesting. That is, people could not bear to stay another 3 months to get a big chunk of equity that they'd worked for the past 21 months.
If people recall that NY Times article about Amazon culture, I had already heard examples of everything in that article and more from people who had left.
> Immigration restrictions are arbitrary and unfair, and in my mind any carveouts for them are a good thing.
Given how many CS grads in US colleges are struggling to find a job these days, I disagree.
If there is demand beyond what local supply can provide, sure. That may have been the case 10 years ago, but it's not the case today.
> Is it really that much different if Amazon brings in a foreign worker to Seattle vs someone from Mississippi?
in what way do you mean different? i would say it is wildly different
If you're worried about from poorer areas coming in and taking our jobs, how much distinction is there really whether they come from a poorer state or a poorer country?
America has free and open trade within its borders. Nobody seems to mind that there are no visa restrictions on someone from Mississippi taking a job in California.
The distinction we make between a foreigner coming to take a job and a domestic worker taking a job is (with some particular exceptions) is largely a mental construct.
hiring a domestic worker immediately reduces social burden on the rest of the country who should be supporting the domestic worker if they can't find work
hiring a foreign worker does not immediately reduce social burden on the country with the job
The distinction is that in America, we are obligated to take care of Americans.
If people immigrate to America, the arrangement should be mutually beneficial.
We are not, and should not be, the self-appointed saviors of the world.
> We are not [...] saviors of the world.
This is definitely true. You are getting cheap educated labor, boosting your country's economy and crippling competition. Self interest, not savior behavior.
Now, that's irrelevant to the argument you are replying, that shows the holes in the wage depression argument.
ignoring the absurdness of this argument, it's actually a better deal for some workers to stay in poorer areas of the US because there are now similar job opportunities nationwide while those areas have a lower cost of living. can't find the study rn bc i'm busy but it came out a few years ago i think. used to be a worker from the south would move to NYC and it would drastically change their financial situation, but now it's not the case anymore.
> I'm kind of horrified by the rise of anti-immigrant rhetoric in engineering circles online and how normalized it's becoming
Agree, and it came on pretty suddenly as well, which is particularly horrifying. To me it shows how fragile civility and safety is. I see this type of sentiment showing up in the comment sections of YouTube videos on tech or financial topics recently. I think the reality is when people feel their own way of life and chance at becoming rich is at risk, they will search for whatever external risk they can eliminate. And increased competition (from foreign talent) is one such risk.
If it were just that, it would be one thing. But alongside the protectionism, I am seeing a lot of outright racist comments accompanying this backlash against immigrant labor. Like comments that play up stereotypes or worse. As a mild example, I see people saying things like “They can’t fix their own country so they’re coming to ruin ours” or “We don’t need more call center scammers”.
The links I have added above all show that Engineers are in fact impacted by this.
???
The links you have shared are relating to the Engadget leaks - which is specifically about turnover among warehouse workers.
Amazon is not using H1B workers to fill these positions.
You must be confused.
If you look again you'll find another link to the H-1B data, And there are many types of engineering titles listed there.
Link updated.
From Jassy's blog post in September:
>It’s created artifacts that we’d like to change (e.g., pre-meetings for the pre-meetings for the decision meetings, a longer line of managers feeling like they need to review a topic before it moves forward, owners of initiatives feeling less like they should make recommendations because the decision will be made elsewhere, etc.) [...] So, we’re asking each s-team organization to increase the ratio of individual contributors to managers by at least 15% by the end of Q1 2025. Having fewer managers will remove layers and flatten organizations more than they are today.
Amazon is a meatgrinder on its workforce, but I will give credit where it's due - I think thinning out management is a noble goal and endeavor. If it's true that these layoffs don't impact as many IC roles, it's probably worth calling that out.
(It's just awful convenient that the timing of this is also when everyone is staring down a rough economy)
If the problem is that lower-downs are carrying out extensive planning for meetings where higher-ups are present, the culture issue might not be with the people who are adapting...
Original link to Jassy's blog post in September:
https://www.aboutamazon.com/news/company-news/ceo-andy-jassy...
> Amazon is a meatgrinder on its workforce, but I will give credit where it's due - I think thinning out management is a noble goal and endeavor. If it's true that these layoffs don't impact as many IC roles, it's probably worth calling that out.
Their filings show that it is still mostly ICs. If you’re doing a cut of 15% of the company (or whatever the number is), that has to include a large number of ICs.
Using "culture fit" to justify mass layoffs is, in fairness, probably a sign of a company's culture. Just not in the way they intended.
Indeed. It seems like splitting hairs. It says that their upper level management made a lot of bad calls about headcount growth. And, as always, it's the people below the decision makers who pay the price.
> Jassy explained that as Amazon added headcount, locations and lines of business in recent years, “you end up with a lot more people than what you had before, and you end up with a lot more layers … sometimes without realizing it, you can weaken the ownership of the people that you have who are doing the actual work.”
"And here's something else, Bob. I have eight different bosses right now."
"I beg your pardon?"
"Eight bosses."
"Eight?"
"Eight, Bob."> you end up with a lot more people
That's a funny way to describe deliberately wasting thousands of work hours screening, interviewing and hiring people they didn't need. It seems like those making these staffing decisions should be the first to go, yet that never seems to be the case.
Correct. CEO's layoff explanation indicates two things.
First, the people who made the hiring decision back then were wrong, since they seemingly hired a lot of people for unneeded roles.
Second, the people in charge now lack the vision or ideas on how to put 14,000 already-trained employees to good use on new projects, new products, etc.
You can do the right thing and still need to reverse the decision. If all the signals in the world suggest you will be able to support more initiatives in future then you should hire. If in the near future the economy changes dramatically and you can't support those hires, you need to let them go.
You describe the problem flawlessly.
"If all the signals in the world suggest you will be able to support more initiatives...
... then you spend millions hiring and onboarding tens of thousands of people over many months, only to fire those people within a number of years.
THIS is why management is paid the big bucks.
Yes, the current executive culture of mass layoffs.
The culture is "I want another yacht".
To be fair, I would like another yacht too. Especially considering my first yacht is really better described as a kayak.
I would like another kayak too. Especially considering my first kayak is better described as a shower cap.
AKA the culture of “Why is AWS down again?”
To be fair, there is no public information indicating that Andy Jassy has his own yacht.
Maybe he is a private train or airship guy. I can respect that.
Cannot understand why ultra rich people not building luxury zeppelins instead of extra yacht.
It's harder to see the peasants faces as you laugh at them from a zeppelin.
It still was when these people were hired. What has changed isn't the greed, but what is done to service it.
I was at Amazon during the last period of Layoffs.
The culture was abysmal. Not because of layers, Andy, but because you decided to do all your announcements in secret on A to Z.
Cowardice.
> Amazon says it didn’t cut 14,000 people because of money. It cut them because of ‘culture’
So they're saying Amazon has culture of being assholes to others? I guess at least they're honest about it, and their admission comports with other accounts about how they do business.
Culture of importing cheaper labor that they can manipulate.
The H1B program is broken and ripe for abuse.
> Culture of importing cheaper labor that they can manipulate.
> The H1B program is broken and ripe for abuse.
Offshoring is a much bigger problem. These abusive companies can "save" way more money by exporting the job than importing a worker to fill it, and pandemic-era changes have accelerated that.
I'm starting to think offshoring is better for America. Because house prices are unaffordable. Should a simple house really be $2 million ?
> I'm starting to think offshoring is better for America. Because house prices are unaffordable. Should a simple house really be $2 million ?
Do you really think it would be better for the rest of America to become like Detroit? Too few have jobs, so housing craters?
The solution to housing affordability is to build more housing (or relocate jobs to where housing is more affordable), it's not to make the common people poor.
> I'm starting to think offshoring is better for America.
Except you are offshoring for less than the "Best and Brightest" that can be done in the US, especially at Amazon.
In fact, the most unqualified of the bottom of the barrel are being sought out because it is cheap. Not for actual skills and 'talent'.
> Because house prices are unaffordable. Should a simple house really be $2 million ?
Given that everyone believes that their house will keep going up leads me to think that thanks to AI, we are certainly going to have a 1929 style flash crash in house prices with less jobs when AI companies start declaring "AGI".
Be careful what you wish for. We could end up in a situation where we have unremarkable homes for $2 million and no local jobs capable of making the mortgage payments.
We are already pretty much there. Only probably a few percent can buy homes now in areas that have good job markets. The SF bay is firmly a 1%'er area now to buy a single family home. You need to now have two L5 incomes or so to even consider it...and somehow make that wage for 30 years... Yeah, no.
Yup. I am a CS professor at a community college in the Bay Area. I make good money for a tenure-track professor (slightly under $112,000, in fact), but the problem is that there are many thousands of households in the area that make multiples of what I make, and due to our limited housing supply, I can’t compete with them. Thus, home ownership within a 30-minute commute is not in the cards for me unless I become rich, and I’d need to make a 90+ minute commute from exurbia to find homes I could afford that are in safe neighborhoods. Even if I quit my job and somehow landed a high-paying software engineering position, I’d be scared about taking on a 30-year mortgage for over $1 million, especially since there’s no way to guarantee making a $200,000+ salary the entire length of the mortgage.
Thus, I rent an apartment, and I anticipate being a lifelong renter as long as I’m in the Bay Area. I also don’t anticipate being able to retire in the Bay Area, though that’s not for another 30 years. My long-term plan is to save a down payment for a vacation home somewhere affordable that I’ll use as my retirement home when the time comes.
Depends on its location and how many dual earner high income households want to buy it. There is no reason a specific lot should not be worth an arbitrary $x.
Is such gross inequality really good for America?
You think offshoring current domestic high wage labor so that the US is exclusively split between low wage labor and ultracapitalists will reduce gross inequality?
> “We are committed to operating like the world’s largest startup, and … that means removing layers.”
I learned a long time ago that behaving like a startup is not a good thing, and I've specifically oriented my career towards working at companies that don't even want to pretend to imitate startup culture. I'm very happy in enterprise-land.
At that scale, it’s the worst of both worlds.
You set the expectation that you can deliver at the pace of a lean startup, but every step of the way you are slowed down by a process or internal dependency that is operating like a fortune 100 company.
Large companies should just fund startups and acquire them when the product has shipped than try to create a culture where teams are expected to operate a speedboat that is towed by an oceanliner.
> Large companies should just fund startups and acquire them when the product has shipped
I mean, that's basically what big tech has been doing for the left 15 years., not then people get upset that "Foo Corp doesn't innovate, it only acquires".
Kinda. The sweet spot is working at a "mid-cap" company. The company is growing and you have resources and freedom to do things, but not so big that you are in a bureaucratic nightmare.
I tell people that the best size of company to work at is one that's just barely big enough to have an HR department.
It's hard to beat the authority and responsibility one personally has at a startup.
Lol. You'll have exactly 1/1,500,000 the authority and responsibility.
They don't mean empowering their workforce. "We want to act more like a startup" is code for we want less accountability for bad decisions.
Do we have any write ups or post mortems from WhatsApp employees prior to the acquisition and the massive buy out?
I want to (artificially perhaps) peg my projects to a smaller cohort of employees if it means the stress to them is worth it if they have the autonomy to ship stuff on their own accord, for a general feeling of having a successful and useful career.
It is especially not a good thing when you need to provide reliable services, coordinate across multiple business units, retain talent not chasing an equity payday, and protect your moat.
Full disclosure: I do not have an MBA.
100%
Finding out that one of the world's largest economic forces aspires to burn out their workforce and spend more time shooting from the hip is depressing.
I joined an actual startup and am also very happy. We are just focused on making the product work. Not on promo docs or headcount fighting.
I have worked at both and... well they're just very different. It's mostly trade offs. What specifically for y'all?
There's dysfunction in both, it's just different types of dysfunction.
As companies grow (and it's not binary), a lot of things (have to) change which may be to your taste--or may not be.
What are the aspects that you're looking for from enterprise-land
Sane workload, work hours and vacation days for a start.
It’s 2025 and I still see “unlimited PTO” in many places.
That comes with high profit margin and moat (for your specific labor, not just the business's moat).
If you don't have leverage, you won't get those things regardless of enterprise or small business.
Sure but overtime in enterprise is paid. In a startup you might get some worthless equity.
Also, in startups these things still happen more often, the culture normalizes unpaid overtime, unused PTO, etc. E.g.:
> While overtime is a reality in both startups and large corporations, the difference lies in the motivation behind it. In startups, work goes beyond traditional hours, not out of obligation, but from a genuine passion and commitment to achieving shared goals.
source: https://www.sdsolutions.tech/post/what-is-a-startup-culture
> overtime in enterprise is paid.
Not in the US. Most enterprise software engineers are salaried and do not receive overtime pay.
And yet, millions of people work 40 hour weeks and take a couple vacations per year while working in razor-thin margin industries like grocery stores and low margin restaurants, manufacturing, agriculture, construction, retail, trucking and services ranging from hair stylists to accounting.
Sane working hours and vacation time should be taken as a given in the modern economy. Unusually long work hours should be reserved for unusually highly paid professions like investment banking and surgeons.
In the US, that might be true if you don't have kids, and/or don't aim to buy a home in a major metro. Otherwise, a lot of those people are going to be working multiple jobs, or relying on a higher earning spouse. Especially retail and restaurant workers. Most won't even get subsidized health insurance from their employer, and if they do, they are not going to be able to afford the deductibles with their income from one 40 hour per week job.
This seems like more smoke and mirrors. I’ve heard some speculation that this is about cutting capex in salaries so they can afford a big purchase from Nvidia. I guess we’ll see in the coming months.
Salaries are operating expenses not capital expenses.
Culture is driven down so… guess they need to start looking there. :)
"Culture" is whatever your directs are putting into their Connections every morning :)
Hello, highly experienced engineer prospective hire. Tell me about a time when some memorized interview behavioral question, in STAR format. Now do this coding screening despite all your experience. Now tell me you want to be an engineer in a startup, and not in huge company of metrics-gaming and routine stack ranking cullings.
A fish rots from the head down
Sure. They have a culture of making more money at any cost. See the many reports of treating their workforce poorly. Their people are expendable. The statement is accurate, just not in the way they want us to interpret it.
I don't know how it couldn't be more obvious the only option they had in order to satiate Wall Street is to buy more GPUs for their wildly overbooked AWS demand induced by AI, and the only way to do that was by cutting fixed costs, aka salaries.
Best decision I ever made was repeatedly ignoring emails from Amazon recruiters while they were allowing remote work around the pandemic. Fuck that place.
One of the better decisions I ever made was not ignoring emails from folks recruiting for Amazon in 2003. It was a different place back then, and truly like "the world's largest startup." The other thing that was different back then was that the people I worked with were all so blindingly smart. I'm pretty smart, but in 2003 I often felt like the dumbest person in the room[1]. In 2025 that feeling was rare, and not simply because I had 20 years more wisdom.
I left Amazon for the third and last time a couple months ago and have no regrets.
If you're still there and reading this, Amazon still has a lot going for it as a place to work. But it's not the electric place I recall from 20 years ago. I'm not sure if there is any company that can match both the startup-like freedom of action with massive scale of early 2000s Amazon.
[1] In case it isn't obvious: this is a desirable condition because it means you get to learn something.
I think it's reasonable to s/amazon/google in this post -- it's equally true there.
I never worked for google (interviewed but was rejected) but I have suspected this is true -- that there was a sweet spot where google was a magical place, but that time has long passed.
Nvidia is the new magical day care center for engineers. Not anymore for Google or Amazon today.
I don't necessarily need an electric place to work. Smart people and a boring mission/tech stack is fine. I just think their layoff(s) in disguise when they forced everyone to RTO is/was a slap in the face. Instant, permanent loss of trust.
It's still easy to feel like the dumbest person in the room at Amazon... until you cut through the bullshit and realize everyone else in the room is a complete impostor skilled in maximalization, social engineering, politics, and nothing else.
When did things start going south, in terms of what year, or what events?
There's a bunch of milestones, for me the standout one was managers starting to abuse marking tickets for large events as "secret" to stop people from reading their screwups. Someone leaked that the cause for some large AWS outage was someone oopsing some CLI command, and it seemed to trigger a pretty large shift.
Yeah, Amazon is in my list of “won’t work there” places.
Too many horror stories.
Then their information campaign is working. They need bodies for the grinder, not free thinkers with agency and autonomy. Much like the obvious spam scam messages with glaring typos, Amazon signals to the market that driven corporate cogs that will shiv someone to get ahead need only apply.
Andy Jassy seems incredibly disconnected from reality.
Reminds me of Marc Benioff in a lot of ways.
One of the worst lies since "AGI".
Even most here on HN who are in the business of replacing humans with AI would agree that Amazon knows they are lying.
Must be close to a rats den working at Amazon's offices with over 200K+ employees in corporate to then look at them and then lay them off and say it's for "culture".
There's no reason for them to tell the truth, given its immensively profitable to keep lying with no costs at all.
If you decide to join Amazon after this, make sure you get a brain scan first.
Seriously.
Amazon spent a ton of money on AI.
It hasn't paid off, yet
And Amazon needs to stay profitable over some time-bound interval.
So, layoff expensive human resources ... continue investing in AI, fingers crossed that it pays off, and the market is happy.
Profit.
The culture of Whoville having too many presents and joy this holiday season.
Hey, I’m not a lawyer and also probably pissing in the wind here, but isn’t firing like 14k people for not financial reasons a giant ass wrongful termination suit?
How does a company define or at least describe company culture and displays it up front? I am genuinely curious, and not trying to start any sort of flame wars.
pip culture
Did you mean
uv pip install culture
Does Amazon really need to pip faster?
Even in Reagan's yuppie cocaine fueled 1980s America, layouts around the holidays were considered a very bad, and only done when a company was desperate. It was a guaranteed social scarlet letter for executives. In post 2010 'tech bro' America, management does it just for the LOLs. This isn't normal, even for capitalist America.
The average tech CEO today is a much greater villian daily than the nationally reviled 'corporate raiders' of that time were a couple of times a year. I don't know WTF happened to this country.
So, union busting then :)
Amazon went from an innovative tech company with an efficient culture where builders could build and ship great products, and where promotions where based on merit, to a completely toxic bureaucratuc hellhole, where all decision making has been hijacked by sociopathic parasites who have learned to game the system for their own benefit.
- most leadership, including technical, is now filled with compete imposters who have very little understanding of tech or market.
- product and strategy decisions are not based on data anymore. Any 'data' is now extremely cherry-picked
- it's standard practice to just completely hide/exclude any negative indicators/metrics.
- promotions are no longer merit-based. They are based exclusively on your ability to social engineer your managers/leadership, and your ability to manufacture metrics that sound good (to imposters who can't rationally inspect/critique them)
- there is zero real innovation happening at Amazon now
- good engineers are leaving in droves and being replaced by 3rd party external consultants
I knew some early on Amazon execs. There was crazy backstabbing of each other at the top from very early on.
Can I get a translation like I don't care about political correctness?
The culture of money
Hierarchical structures are so odd, you would think the higher levels optimize for intelligence and empathy but in practice it optimizes for sociopathy and maybe public speaking skills
Gervais Principle
The problem with reading that is that it is, I find, almost impossible to stop classifying people into sociopath, clueless or losers....
80% of the time, we all fit into one or more of those categories don't we? The problem is we move between those categories constantly.
Which is where that article series eventually goes, getting fractal on the categories and their inter-relationships and how people move between the categories constantly. That's also about where the article series starts to maybe get too self-serious and hard to read, though.
hello fellow sociopath
> Because of 'culture'
Nah, it's to instill fear.
Otherwise, why would you layoff people that are high performers due to 'culture'? That's just idiotic.
They say as if this is a good thing. The tone deafness is pretty staggering.
"The beatings will continue until morale improves"
Sure, the culture of "Jeff wants another yacht"
Jeff isn't running Amazon anymore, it's Andy Jassy, who doesn't own a yacht.
Chairman of the board probably can afford another yacht with amzn up 10% today. He probably even talks about things with Jassy.