UPS to Cut 20,000 Jobs as Amazon Slashes Shipping Volume
In a shocking move that rocked the logistics and e-commerce industry, UPS announced today the layoff of 20,000 employees and the closure of 73 facilities. The announcement, made during their Q1 2025 earnings call, cited a steep reduction in shipping demand from Amazon—marking a seismic shift in a decade-long relationship between the two corporate giants.
A Rocky Road Between UPS and Amazon
For years, Amazon was UPS’s largest customer, contributing 11.8% of UPS’s total revenue in 2024. Still, the relationship was strained by low profitability and shifting logistics strategies. Beginning in 2024, UPS launched its “Network of the Future” initiative, aiming to streamline operations and reduce dependency on Amazon, which had increasingly leaned on its own delivery network and cheaper alternatives like USPS.
Adding to the pressure were Trump-era tariffs on Chinese imports, which disproportionately impacted companies shipping goods from platforms like Shein and Temu—many of which used Amazon’s fulfillment services. These trade tensions indirectly hit UPS’s volume and margin, setting the stage for today’s drastic move.
The Timeline of a Meltdown
The turbulence began quietly but steadily:
- January 1, 2024: UPS laid off 12,000 workers in early cost-cutting measures.
- December 31, 2024: UPS disclosed Amazon accounted for 11.8% of total revenue.
- January 1, 2025: The two firms finalized an agreement to reduce Amazon's shipping volume with UPS by 50% by late 2026.
- April 29, 2025: UPS officially announced layoffs and facility closures during its Q1 earnings release.
Read the full UPS Q1 2025 Earnings Report
Echoes from the Top
Challenged by analysts over the depth of the layoffs, UPS CEO Carol Tomé acknowledged the global and political headwinds shaping their decision:
"The world has not been faced with such enormous potential impacts to trade in more than 100 years. The macro environment may be uncertain, but with our actions, we will emerge as an even stronger, more nimble UPS."
Source: Fox Business
An Amazon spokesperson responded with a more diplomatic tone, subtly shifting responsibility:
"Due to their operational needs, UPS requested a reduction in volume and we certainly respect their decision. We'll continue to partner with them and many other carriers to serve our customers."
Source: San Francisco Chronicle
In a fiery political twist, White House Press Secretary Karoline Leavitt criticized the inclusion of tariff-related costs in Amazon’s pricing, saying:
"Amazon's inclusion of tariff costs on product prices is a hostile and political act against America."
Source: WPDE News
A Human Crisis Beneath the Headlines
Behind every pink slip is a family wondering what comes next. The 20,000 layoffs don’t just impact warehouse floors—they touch millions of homes, from rural delivery drivers to single parents navigating sudden job loss. Local communities where facilities are shutting down face a ripple effect of business closures and declining municipal revenue.
This moment has sparked larger conversations about America’s overreliance on mega platforms like Amazon and the fragility of logistics ecosystems in the face of changing trade policy. As one analyst put it, "This isn’t just UPS and Amazon—it’s a warning shot to anyone betting big on inflexible partnerships."
To learn more about the bigger picture behind this crisis, visit the UPS Tariff Impact Resource Center.
Conclusion
✔️ UPS's decision to lay off 20,000 workers underscores the risks of relying too heavily on one major client like Amazon.
✔️ With trade policies, internal restructuring, and shifting logistics trends colliding, this crisis signals broader economic tremors across industries and communities.
