UPS to Cut 30,000 Jobs in Major Cost-Reduction Strategy
United Parcel Service (UPS), one of the leading package-delivery companies globally, is embarking on a significant cost-cutting initiative. The plan includes laying off approximately 30,000 employees. This decision is part of a broader strategy aimed at achieving $3 billion in savings by 2026.
Financial Goals and Job Cuts
UPS’s Chief Financial Officer, Brian Dykes, announced the layoffs during an earnings call. He stated that the cuts are required to strengthen the company’s financial position and reduce dependence on its largest client, Amazon.
- Target savings: $3 billion by 2026
- Job cuts: Up to 30,000 employees
- Revenue for Q4 2025: $24.5 billion
- Projected revenue for 2026: $89.7 billion
Job Reduction Strategies
The job reductions will primarily occur through voluntary buyouts and natural attrition. Dykes mentioned a forthcoming voluntary separation package aimed specifically at full-time drivers.
Additionally, UPS plans to close 24 facilities in the first half of the year, with further evaluations for additional closures later in 2026.
Previous Cost-Cutting Measures
This new initiative follows a successful reduction effort in 2025, where UPS managed to save $3.5 billion. This was achieved by cutting 26.9 million labor hours and closing 93 buildings, demonstrating the company’s ongoing commitment to enhancing operational efficiency.
Response from the Teamsters Union
The Teamsters union expressed strong disapproval of the job cuts. President Sean O’Brien criticized UPS’s actions in a social media statement. He reflected on last year’s rejection of a buyout offer, emphasizing the value of UPS drivers and the harsh conditions they endure.
Future Directions
UPS has previously announced its intention to reduce Amazon shipments by half. This strategic shift aims to focus on fewer, more profitable deliveries.
As UPS navigates these significant changes, industry observers will be watching closely to see how these moves impact the company’s overall performance and relationships with its workforce.
