On August 24, the Dallas-based company Southern Star Express LLC informed the Texas Workforce Commission of 55 imminent layoffs at its Arlington location.
The company was a delivery service partner for the online retail giant Amazon. According to Dallas Business Journal, Amazon abruptly ended its contract with Southern Star Express on August 23.
“This closure is expected to be permanent and due to the unexpected and sudden cancellation of Amazon’s contract with Southern Star Express LLC’s contract,” read a letter by Southern Star Express General Manager Christopher Noren (via. Dallas Business Journal).
According to Noren, all affected employees have been notified of the layoffs, which will become effective on September 29.
The Arlington warehouse’s layoffs come as a result of Amazon’s efforts to scale back operations due to company overgrowth during the COVID-19 pandemic. After a slowdown in online shopping in the first two quarters of 2022 caused a dip in the company’s earnings, Amazon announced a series of delays and closures of warehouses across the country. Recently the online retailer announced the closure of five warehouses in Massachusetts plus another two in the Baltimore area. In March, the public was informed it would close all 68 of its bookstores and pop-up shops in favor of expanding its grocery markets and department stores.
Although Amazon’s spokesperson Caitlin McLaughlin told Patch that the decision of closing the five Massachusetts warehouses was made with employees, partners, drivers and customers’ best interests in mind, the company looks to be taking steps into more automated facilities.
Amidst criticism over safety and working conditions, Amazon unveiled new warehouse robots in June 2022. As reported by Geek Wire, the company sees long-term benefits in worker safety, productivity and efficiency. Via GeekWire, Philip Su, former Microsoft and Facebook software engineering leader shared his views on the pragmatic implications of the announcement: “The higher the standards and protection that unions or other facilities provide workers, the higher the motivation for a company like Amazon to quickly invest in and deploy these sorts of labor-removing technologies.”
Recently the company shared its interest in buying iRobot, the Bedford-based company that invented Roomba while it expects to complete construction of its massive 4.1 million-square-foot fully automated fulfillment center in Ontario, California by the end of 2022.
In case you missed it, here’s Local Profile report on two local companies among Texas’ best employers.