UPS to Cut 20,000 Jobs Amid Declining Amazon Shipments and Strategic Restructuring

UPS to Cut 20,000 Jobs Amid Declining Amazon Shipments and Strategic Restructuring

In a significant move to adapt to changing market dynamics, United Parcel Service (UPS) announced on Tuesday its plan to reduce its workforce by approximately 20,000 employees and close 73 facilities by the end of June 2025. This decision comes as the company faces decreased shipping volumes from Amazon, its largest customer, and seeks to streamline operations to improve profitability.​

The layoffs will affect just over 4% of UPS's global workforce, which currently stands at around 490,000 employees. This announcement follows a previous decision by the company to cut 12,000 positions last year. The consolidation efforts are expected to yield $3.5 billion in savings this year, although UPS anticipates incurring $400 to $600 million in costs related to severance and facility closures.​CBS NewsMarketWatch+2New York Post+2Investopedia+2

"These actions will enable us to expand our U.S. Domestic operating margin and increase profitability," said Brian Dykes, UPS's Chief Financial Officer, during an earnings call on Tuesday morning. The company reported $21.5 billion in revenue for the past quarter, slightly exceeding analysts' expectations.​Investopedia+4CBS News+4Houston Chronicle+4

The reduction in Amazon shipments is a significant factor in UPS's restructuring plans. In January, UPS announced an agreement with Amazon to decrease its delivery volume by more than 50% in the second half of 2026. This strategic decision reflects UPS's focus on prioritizing more profitable segments of its business.​CBS News+10CBS News+10CBS News+10Houston Chronicle

The job cuts and facility closures have raised concerns among labor unions. Sean M. O'Brien, General President of the International Brotherhood of Teamsters, emphasized that UPS is contractually obligated to create 30,000 Teamsters jobs under their current national master agreement. "If UPS wants to continue to downsize corporate management, the Teamsters won't stand in its way," O'Brien stated. "But if the company intends to violate our contract or makes any attempt to go after hard-fought, good-paying Teamsters jobs, UPS will be in for a hell of a fight."​Houston ChronicleCBS News

UPS's restructuring efforts also come amid broader economic uncertainties, including trade tensions and shifting consumer behaviors. The company has not provided an updated full-year financial outlook, citing ongoing economic unpredictability.​New York Post+3The US Sun+3Investopedia+3

As UPS navigates these challenges, the company's leadership remains focused on adapting its operations to align with current market conditions and customer demands. The planned workforce reductions and facility closures represent a significant step in UPS's ongoing efforts to enhance efficiency and maintain its competitive edge in the logistics industry.​Houston Chronicle

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Sources:

• CBS News: "UPS cutting 20,000 jobs amid reduction in Amazon shipments"

• Investopedia: "UPS Tops Q1 Estimates, Announces 20,000 Employees Being Laid Off This Year"

• MarketWatch: "UPS to cut 20,000 jobs and close dozens of buildings as Amazon shipping volume declines"

• New York Post: "UPS to slash 20,000 jobs on weak Amazon deliveries over Trump tariff turmoil"​New York Post+13CBS News+13CBS News+13InvestopediaHouston Chronicle+3MarketWatch+3The US Sun+3New York Post