UPS Cuts 20,000 Jobs Amid Amazon Delivery Reduction

LOUISVILLE, Ky. — United Parcel Service (UPS) announced on Tuesday it plans to cut 20,000 jobs this year as part of a cost-cutting strategy linked to reduced package deliveries from Amazon, its largest customer. The shipping giant, which has around 490,000 employees worldwide, indicated that these layoffs represent over 4% of its workforce.

This announcement follows last year’s news of a 12,000 job reduction. UPS also revealed plans to close 73 facilities by June 2025 and is reviewing its network for possible additional closures. ‘These actions will enable us to expand our U.S. Domestic operating margin and increase profitability,’ Brian Dykes, the CFO of UPS, said during an earnings call.

UPS anticipates a significant decline in package volumes from Amazon, which is expected to drop by more than 50% by June 2026. Dykes stated that these cutbacks are part of the company’s overall restructuring plan known as the Network of the Future. UPS is forecasting up to $3.5 billion in savings from these efforts in 2025.

According to Sean M. O’Brien, President of the Teamsters union, UPS is contractually obligated to create 30,000 jobs for Teamsters under their existing national agreement. ‘If UPS intends to violate our contract, we will be in for a hell of a fight,’ O’Brien said.

UPS’s latest quarter report showed revenues of $21.5 billion, but the company cautioned about potential impacts on business due to global trade policy shifts and tariffs introduced under the Trump administration, which have already begun to affect shipping volumes.

UPS’s shares fell by 0.6% on Tuesday, reflecting market concerns about the company’s future amid a backdrop of economic uncertainty and the anticipated downturn in package deliveries. While the company continues to manage adjustments resulting from tariff changes, it aims to secure profitability through operational efficiencies.

As it prepares for the upcoming holiday peak delivery season, UPS is strategizing to mitigate the effects of these significant changes on its operations.