UPS to Slash 30,000 Jobs This Year as It Dumps Amazon Deliveries — Here's Why Your Packages May Cost More

United Parcel Service is cutting up to 30,000 jobs this year as it accelerates its withdrawal from Amazon, a move that could see everyday shoppers and small businesses paying significantly more for deliveries.

The logistics giant announced the job cuts on Tuesday following its quarterly earnings release. Chief financial officer Brian Dykes confirmed the reductions would be 'accomplished through attrition', adding that the company expects to 'offer a second voluntary separation programme for full-time drivers,' according to CNBC.

What Does This Mean for Your Shipping Costs?

If you've been worried about your next delivery bill, prepare yourself. UPS announced a 5.9% average rate increase in 2025 to cover this year's costs, but industry analysts warn that the real impact on consumers will be much greater.

According to data from shipping consultants, actual costs for most shippers are rising between 8% and 12%, once surcharges, residential delivery fees, and new dimensional weight rules are included. E-commerce businesses shipping lightweight packages to homes are hardest hit, with some express services experiencing increases above 7%.

The timing is particularly challenging. As UPS sheds workers and closes facilities, it is simultaneously raising prices, creating a double squeeze for businesses that rely on parcel delivery.

The Amazon Factor

Behind these cuts is UPS's calculated retreat from its largest customer. The company has described Amazon's delivery business as 'extraordinarily dilutive' to margins and is moving forward with what it calls an 'accelerated glide-down plan', Fox reported.

'We're in the final six months of our Amazon accelerated glide-down plan and for the full year 2026, we intend to glide down another million pieces per day while continuing to reconfigure our network,' said chief executive Carol Tomé during Tuesday's earnings call.

According to Dykes, UPS expects to save around $3 billion (£2.17 billion) in 2026 by accelerating its withdrawal from the Amazon partnership and cutting up to 30,000 operational positions. The company also saved $3.5 billion (£2.53 billion) in 2025 through broader consolidation efforts, CBS News reported. However, these savings are not being passed on to customers—instead, UPS is reinvesting in automation and network restructuring.

78,000 Jobs Gone in 14 Months

The scale of UPS's workforce reduction is staggering. Alongside last year's 48,000 job cuts, the company will have eliminated 78,000 positions in just over a year—far exceeding earlier estimates of around 20,000.

Dykes revealed plans to close 24 buildings in the first half of 2026, with further closures possible later in the year. This follows 93 facility shutdowns in 2025, part of what was described as 'the largest network reconfiguration in UPS history.'

For the approximately 490,000 workers remaining at the Atlanta-based company, uncertainty remains. The Teamsters union issued a statement noting its members 'still know their worth,' if UPS reintroduces its buyout programme.

'We're perfectly happy for UPS to realise growth and cost savings on the backs of corporate managers so long as they uphold their contractual commitments to our members,' the union said, CNBC reported.

What Happens Next?

Despite the significant restructuring, Wall Street appeared pleased. UPS shares rose 4% in morning trading after the company beat fourth-quarter earnings estimates.

However, for consumers and small businesses, the outlook is less positive. With reduced capacity, higher rates, and new surcharges on bulky or oversized items, shipping costs are likely to continue rising. Businesses that previously benefited from competitive pricing due to the UPS-Amazon rivalry may find fewer options and higher bills.

The message from UPS is clear: it is prioritising profitability over volume. Whether this strategy delivers long-term value remains to be seen, but in the short term, it is shoppers and sellers who will be footing the bill.