United Parcel Service (UPS) has announced plans to eliminate 20,000 jobs in 2025, a significant part of the company’s strategy to reduce costs, primarily due to a decrease in deliveries from its largest customer, Amazon. With operations spanning over 200 countries, UPS currently employs approximately 490,000 workers, meaning this layoff will impact about 4% of its workforce. This follows UPS’s decision to cut 12,000 jobs last year as part of a broader cost-cutting initiative.
Job Cuts and Facility Closures as UPS Restructures
In addition to the 20,000 layoffs, UPS revealed that it will close 73 of its facilities by June 2025, with potential for more closures down the line. The company’s restructuring efforts are aimed at improving its U.S. domestic operating margin and increasing profitability.
Brian Dykes, UPS’s Chief Financial Officer, explained during an earnings call, “These actions will enable us to expand our U.S. domestic operating margin and boost profitability.” According to a regulatory filing, the layoffs and facility closures are directly linked to the anticipated decrease in shipping volume from Amazon.
The company reported $21.5 billion in revenue for the most recent quarter and expects its consolidation efforts to result in savings of $3.5 billion this year.
Teamsters Respond to UPS Job Cuts
Sean M. O’Brien, President of the Teamsters, which represents many UPS workers, emphasized the union’s commitment to protecting 30,000 Teamsters jobs as per the current National Master Agreement. “If UPS wants to downsize corporate management, the Teamsters won’t stand in its way, but any attempt to target good-paying Teamsters jobs will lead to a major confrontation,” O’Brien warned.
Amazon Partnership and UPS Strategy Shift
Earlier this year, UPS reached an agreement with Amazon to reduce the delivery volume by over 50% in the second half of 2026. A UPS spokesperson clarified that the decision to reduce Amazon shipments was intentional, aimed at improving revenue quality and domestic operating margins.
Amazon responded by saying it continues to have a “strong working relationship” with UPS and had even proposed increasing delivery volumes before UPS opted to cut them. Amazon’s spokesperson, Kelly Nantel, acknowledged the delivery company’s need to adjust its volume and expressed respect for their decision.
UPS Faces Global Trade Risks
In its earnings report, UPS also highlighted the increasing risks associated with global trade policies, particularly due to recent tariffs imposed by the U.S. government. These tariffs have already started to impact the flow of goods across borders, with UPS handling approximately 400,000 imported parcels daily. CEO Carol Tomé noted that China-to-U.S. trade lanes make up 11% of UPS’s international revenue and are among the company’s most profitable routes.
As the ongoing U.S.-China trade war continues to unfold, UPS is actively updating customers on tariff changes through its website and has introduced the UPS Global Checkout tool to help online shoppers understand their duties, taxes, and fees.
Amazon Faces Pressure Over Tariff Transparency
Meanwhile, Amazon is facing scrutiny from U.S. government officials over its handling of tariff costs. White House Press Secretary Karoline Leavitt criticized the e-commerce giant for a potential move to display tariff charges next to product prices, arguing that Amazon did not do this earlier during the Biden administration’s inflation surge. Amazon denied the report, with spokesperson Tim Doyle stating that Amazon Haul, a low-cost goods store aimed at competing with platforms like Temu and Shein, had only briefly considered the idea before deciding against it.
