UPS Announces Layoffs of 20,000 Workers as Automation Continues

Mei W.

On April 29, UPS announced that it will layoff 20,000 workers and shut down 164 facilities by the end of the year, 73 of which are scheduled to close by the end of next month. The mass layoffs are part of the company’s plan to cut $3.5 billion in costs this year, around 35% of which is expected to come from the layoffs.

Last spring, UPS began a 3-year “Network of the Future” initiative to cut operating costs through the mass automation and closure of facilities. UPS stated on Tuesday that the layoffs are an extension of this initiative necessitated by their other cost-cutting plan involving the 50% reduction of Amazon packages the company delivers by June 2026. Since 2022, UPS had begun reducing Amazon deliveries, delivering instead lesser volumes of more lucrative packages to save the company’s falling profitability.

While connecting the layoffs to this decreased delivery volume, Executive Vice President Nando Cesarone reiterated on Tuesday that their goal of the 3-year initiative is an overall “less dependency on labor” through the full and partial automation of warehouses, as the company plans to automate 400 warehouses and close down 200 by 2028. According to CFO Brian Dykes, 64% of all UPS deliveries now go through an automated warehouse, a 4.5% increase from last year. When the company announced the initiative last year, Cesarone stated that they aim for a 15% increase in delivery volume per worker by 2026.

President Sean O’Brien of the Teamsters Union, representing 70% of UPS workers in the US, responded to the mass layoffs announcement stating that “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.” While the Teamsters bureaucracy claims that the contract obliges UPS to create 30,000 jobs, according to the contract, the 30,000 “new jobs” refer to the offering of existing full-time positions to 22,500 part-time workers and the turning of 7,500 existing part-time positions into full-time positions. The sell-out contract also makes no mention of protections against automation or layoffs.

While monopoly media has cited Trump’s tariffs for the layoffs, workers have pointed out on social media posts that UPS has long been laying off workers to cut costs through automation. In the first half of last year alone, over 23 UPS facilities were partially or fully shut down resulting in the firing of over 2,000 workers, excluding the undisclosed numbers of laid off workers at multiple other facilities.

Image: A UPS worker unloads boxes in 2020 in Arlington TX, US Department of Agriculture, Wikimedia Commons

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