Major U.S. logistics companies are restructuring in 2025, fueling concerns about broader disruptions across the shipping sector. UPS announced 20,000 layoffs and a 50% reduction in Amazon deliveries this week, citing cost pressures, shrinking margins, and trade instability.
Meanwhile, Amazon clarified that its recent internal changes—aimed at boosting operational efficiency—do not involve mass layoffs, contrary to some earlier reports.
UPS slashes workforce and Amazon shipments
UPS confirmed it will eliminate 20,000 jobs and close 73 facilities nationwide by the end of June. The move is part of a $3.5 billion cost-cutting strategy meant to streamline operations and prioritize high-margin business.
A major factor: fewer Amazon parcels. UPS is cutting Amazon delivery volume by more than 50%, a decision the company says will improve domestic profitability.
“This is about profitability and agility,” said UPS CEO Carol Tomé. “The macro environment may be uncertain, but with these actions, we will emerge stronger.”
Amazon, in response, said UPS initiated the volume reduction, even after Amazon offered to increase shipments.
USPS braces for impact
The shakeup could push more deliveries to USPS and FedEx—but it’s unclear whether USPS can absorb major volume shifts without disruption. The Postal Service has not announced layoffs, but analysts warn that changes to last-mile delivery agreements could pressure margins and staffing, especially in rural areas.
USPS depends heavily on bulk delivery deals with Amazon, UPS, and FedEx. A pullback from private partners could disrupt the flow of packages and create new operational challenges.
Teamsters push back on UPS cuts
The Teamsters union, which represents more than 75% of UPS’s U.S. workforce, is closely monitoring the situation. Under the current national contract, UPS must create 30,000 union jobs.
“If UPS tries to go after hard-fought, good-paying Teamsters jobs, they’ll be in for a hell of a fight,” said Teamsters President Sean O’Brien.
Amazon restructures—but no mass layoffs
Earlier reports suggested Amazon planned to lay off 14,000 managers as part of a leadership overhaul. The company has now clarified that no such mass layoffs occurred.
Instead, Amazon completed an internal initiative earlier this year to rebalance its ratio of individual contributors to managers. A spokesperson said this work concluded by March and did not involve widespread job cuts.
“While we aimed to increase the ratio of individual contributors to managers, this doesn’t equate to layoffs,” the company said. “It’s inaccurate to suggest this work is ongoing or that thousands were laid off.”
CEO Andy Jassy had previously commented on the company’s focus on decision-making speed and operational efficiency, which led to some confusion about the scope of the changes.
Intel lays off 22,000 workers
Intel is moving forward with significant cuts, eliminating 22,000 jobs—about 20% of its global workforce—as it pivots toward AI chip development and streamlines its management structure.
Trade war adds pressure
President Trump’s new 145% tariffs on Chinese imports are amplifying volatility across the sector. UPS warned that its China-to-U.S. business—once its most profitable international lane—is under threat. That lane accounted for 11% of UPS’s international revenue in 2024.
Amazon also faced scrutiny over an internal idea to display import tariffs at checkout—an idea that was ultimately dropped.
Automation and uncertainty ahead
Across UPS, Amazon, and Intel, a common trend is emerging: fewer management layers, increased automation, and tighter cost controls. The shift is aimed at surviving economic headwinds and responding to global trade disruptions.
For USPS, the challenge now is staying competitive, managing fluctuating package volume, and avoiding disruptions while private-sector partners adapt.
This content is brought to you by the FingerLakes1.com Team. Support our mission by visiting www.patreon.com/fl1 or learn how you send us your local content here.