UPS to Cut 20,000 Jobs in 2025: Have you heard the news about UPS cutting jobs? If not, here’s what’s going on — and why it’s making headlines across the U.S. In early 2025, UPS (United Parcel Service) announced it would lay off 20,000 workers. Yes, that’s a huge number, and it’s leaving many people wondering what caused this major decision.
Let’s break it down in simple terms — why it’s happening, how Amazon plays a role, and what it means for the economy and everyday people like you and me.
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What Exactly Happened?
UPS, one of the world’s largest package delivery companies, said it will cut 20,000 jobs as part of a big cost-cutting move. This announcement came at the same time the company revealed it was changing its relationship with Amazon, one of its biggest clients.
The company also plans to shut down 73 facilities by the end of June 2025. These closures and job cuts are expected to help UPS save around $3.5 billion. That’s a big number — and it shows just how serious they are about making changes.
But here’s the twist: UPS is not in financial trouble. In fact, they are doing this to become more profitable and efficient, not because they’re losing money. The company wants to focus on customers and areas that give them higher profit margins, which leads us to the next big player in this story — Amazon.
What’s Going on With Amazon and UPS?
For a long time, UPS delivered millions of packages for Amazon. But that’s starting to change.
UPS has announced it will cut its Amazon package volume by more than half. By the end of 2026, Amazon will only account for about 5% of UPS’s business, down from 12% in 2024. That’s a big drop!
So why is UPS walking away from such a massive customer?
Well, UPS says that Amazon isn’t its most profitable customer. In fact, CEO Carol Tomé called Amazon a “volume customer,” meaning they ship a lot of packages, but don’t bring in as much profit per shipment compared to other clients.
UPS now wants to focus more on:
- Healthcare logistics
- Small and medium-sized businesses (SMBs)
- International shipping
- Higher-margin clients
This shift is a strategic move. By letting go of lower-profit deals (like with Amazon), UPS hopes to improve its operating margins — basically, make more money from each delivery.
Why Are 20,000 People Losing Their Jobs?
Let’s be real — 20,000 jobs is a lot. So what’s behind this number?
UPS says the layoffs are part of its effort to restructure and streamline operations. They want to reduce redundancy, cut operational costs, and boost profits.
This isn’t the first time UPS has done this either. In 2024, they already laid off 12,000 workers, most of whom were corporate or management staff. The 2025 layoffs will go further, impacting various areas of the business, especially as the company consolidates facilities.
In other words, UPS wants to do more with less — fewer people, fewer buildings, and more focus on efficiency.
What Do These Layoffs Mean for UPS Workers?
For employees, this news is devastating. Losing a job is hard, no matter how big the company is or how much money they’re trying to save. UPS has said it will offer severance packages and job placement support, but that doesn’t erase the emotional and financial stress these layoffs will bring.
Many of the impacted workers will likely be in operational roles, warehouse staff, or logistics planning. And while the company is focusing more on automation and digital tools, that also means fewer jobs for humans in the long run.
What’s the Bigger Picture?
The layoffs at UPS aren’t happening in a vacuum. They’re part of a larger pattern we’re seeing across the U.S. economy in 2025.
Recently, multiple companies — especially in transportation, logistics, and retail — have warned about slowing demand, higher costs, and unpredictable markets. According to Reuters, new tariffs introduced by the Trump administration have made things even more uncertain. These trade policies are making it more expensive to do business, and many companies are cutting back or hitting the brakes on future investments.
Some major brands like General Motors, Kraft Heinz, and Procter & Gamble have either lowered their earnings forecasts or stopped giving guidance altogether.
So UPS isn’t alone. But because it’s such a large company and such an important part of our delivery system, any major change it makes has ripple effects across the economy.
How Are Investors Reacting?
You might think that laying off 20,000 people would hurt a company’s stock price, right?
Surprisingly, UPS’s stock actually went up after the announcement. That’s because investors tend to like cost-cutting moves — they see them as a sign that the company is becoming more efficient and protecting future profits.
But it’s not all good news. Analysts also pointed out that UPS’s revenue from domestic deliveries fell by 5.3% in the first quarter of 2025. That’s a red flag that demand is shrinking, even with fewer Amazon packages.
So, while investors may be happy short-term, there are still long-term questions about how UPS will grow in a shifting market.
Why Is Amazon Building Its Own Delivery Network?
One reason UPS can afford to cut ties with Amazon is because Amazon has been building its own delivery network for years. If you’ve seen those blue Amazon vans driving around your neighborhood, you’ve seen this shift in action.
Amazon now handles more than 70% of its own deliveries, using Amazon Logistics and third-party contractors. That means it doesn’t rely on UPS or FedEx the way it used to.
This has helped Amazon cut costs and speed up delivery times. But it’s also made things more competitive for companies like UPS. With Amazon delivering its own packages, UPS has to look elsewhere to maintain its business.
What’s Next for UPS?
So, what’s the future looking like for UPS?
Here’s what we know:
- They want to become leaner and more profitable.
- They’re focusing on higher-margin customers.
- They’re using more automation and technology in their operations.
- They want to invest more in healthcare shipping, like delivering temperature-sensitive medicines and vaccines.
UPS is also working on expanding its international services and making delivery options more flexible for businesses and consumers alike.
But whether these changes will help them grow in the long run depends on how well they adapt to market changes — including e-commerce shifts, global trade rules, and competition from Amazon and other logistics startups.
Final Thoughts: What Can We Learn From This?
At the end of the day, the UPS layoffs are more than just numbers. They represent a major shift in the delivery industry — one driven by profit margins, automation, trade policies, and changing relationships with big players like Amazon.
If you’re a consumer, you might not feel the impact right away. Your packages will still arrive. But behind the scenes, companies like UPS are rebuilding the way logistics works — and that means big changes for workers, investors, and businesses across the board.
If you’re a worker in the logistics or retail sector, this is a reminder of how important it is to stay adaptable and keep learning new skills. The jobs of tomorrow will look very different from the jobs of today.
