In response to a lower-than-projected revenue, UPS has declared a significant workforce reduction of 12,000 employees. The shipping company witnessed a 7.8% decline in revenue, dropping from $27 billion to $24.9 billion over the past year. Notably, UPS experienced a 7.4% decrease in shipping within North America and an 8.3% drop internationally. CEO Carol Tome stated that the layoffs are anticipated to save the company $1 billion in costs, emphasizing the challenges faced in 2023 with declines in volume, revenue, and operating profits across all business segments.
This announcement follows UPS’s previous revelation of plans to hire 100,000 seasonal workers ahead of the holiday rush. The decision to hire additional staff was part of a negotiated deal that allowed UPS workers to accept a five-year tentative contract with increased wages.
The trend of mass layoffs has been notable in recent months, with several major companies, particularly in the Big Tech sector, simultaneously downsizing their workforce. Tech giants such as Google, Amazon, and Discord have joined the ranks of companies implementing substantial layoffs. Furthermore, other notable instances of recent layoffs include Macy’s decision to terminate 2,350 employees, constituting about 3.5% of its total workforce, and Spotify’s announcement in December to lay off around 1,500 employees, accounting for approximately 17% of its workforce.