As the second-largest employer in America, Amazon currently employs around 1.5 million workers. (1, 2) Between 2018 and today, Amazon has onboarded hundreds of thousands of workers, effectively tripling its workforce. (3, 4) But the giant company may be planning a departure from extreme reliance on human employees in the coming years and decades.
According to internal Amazon documents reviewed by the New York Times, some departments within the company are planning to replace employees with robots, impacting up to 600,000 roles. The documents showed that Amazon hopes to avoid hiring more than 160,000 people that it would otherwise need to staff its U.S. warehouses by 2027. (5)
While it’s not yet clear how quickly or extensively automation will affect Amazon’s workforce, the possibility of large-scale job replacement may feel alarming to workers — especially in an already tight labor market where job security remains a top concern.
In addition, Reuters recently reported that Amazon is planning to cut as many as 30,000 corporate jobs. (6) These roles span departments like human resources, devices, services and cloud computing, and reflect the company’s broader push to reduce costs and increase its use of artificial intelligence within corporate teams. These corporate cuts suggest Amazon is leveraging AI to streamline higher-paying positions as well — highlighting that the economic impact of automation and AI may be broader than warehouse work alone.
While many Americans may feel uncertain about a future where machines perform work once done by humans, Warren Buffett has repeatedly argued that automation is not a threat to long-term prosperity — but a driver of it. Here’s why Buffett says not to fear it, and what you can do to prepare your finances if you fear job loss due to automation.
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Why Buffett says not to fear automation
As far back as a 2019 shareholder meeting, Buffett claimed that people shouldn’t be too worried about automation eliminating jobs in the years ahead. In his remarks, he likened the coming automation changes to a previous shift from using manual labor almost exclusively on farms to using the tractor. (7)
When the tractor came along, the new technology eliminated the need for as many farm laborers. And in the last 200 years, most farm jobs have been lost. But even with that enormous shift, people remained employed because new opportunities opened up and would-be farm workers jumped to fill the jobs in a changing economy.
“We find ways in this economy to employ more and more people,” said Buffett. In a 2019 shareholders meeting, on the subject of automation, he said, “This economy works. It continues to work.” (8)
Buffett’s investment company, Berkshire Hathaway, first bought Amazon stock in 2019. (9) Currently, Berkshire owns around 10 million shares of Amazon, valued at around $2.1 billion. If Amazon reduces labor costs through robotics, Berkshire, like any shareholder, could see higher returns. (10)
This doesn’t mean Buffett is endorsing job cuts. Rather, it highlights a central tension in the modern economy: automation may temporarily disrupt workers’ livelihoods while simultaneously rewarding investors who bet on companies that successfully implement it.
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How to prepare your finances for the future of automation
So far, Amazon’s push to automate has improved operations at Amazon’s massive fulfillment centers. In a recent post, Amazon stated that a new robot, Sequoia, allows the company to identify and store inventory 75% faster, and processing an order can be completed up to 25% faster, too. (11)
But as Amazon figures out the finer points of automating its workforce, it’s possible that other large companies will follow in its footsteps. If you are a worker at Amazon, a similar fulfillment assembly line company, or would like to be in the future, this push toward automation could feel like a threat to your livelihood.
While it’s largely up to Amazon how they choose to pursue profits in the future, if you fear job replacement by automation, there are things you can do to prepare for a loss in income, or a backup career change.
Having an emergency fund in place is essential. Save up three to six months of living expenses in a high-yield savings account so that if you experience job loss, you’ll have breathing room until you find a new role.
Also, do your best to avoid taking on unnecessary debts. For example, sliding into credit card debt could set you up for a financial struggle, whether or not you lose your job. But heading into a period of unemployment with high-interest debt can significantly derail your financial future and lead to extra stress.
Beyond having a solid financial setup, you can prepare for automation potentially impacting your job by improving your job skills. For example, if automation does become more standard, new opportunities in the realm of servicing machines are likely to become available. Amazon offers a Mechatronics and Robotics apprenticeship program. (12) Not only could upskilling help you retain your job, but it could also lead to earning more.
No one knows exactly how automation will reshape the workforce or how quickly it will happen. Warren Buffett argues that America’s economic history shows innovation ultimately leads to more jobs, not fewer, even if the transition is bumpy. By building a strong financial foundation and investing in skills that are relevant in an increasingly automated economy, workers can navigate the shift with more confidence — and potentially benefit from the new opportunities it creates.
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Article sources
We rely only on vetted sources and credible third-party reporting. For details, see our editorial ethics and guidelines.
Amazon (1), (4), (11), (12); Global Data (3); Companies by Market Cap (2); The New York Times (5); Reuters (6); Berkshire Hathaway (7), (8); The Motley Fool (9); Fintel (10)
This article provides information only and should not be construed as advice. It is provided without warranty of any kind.