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United Parcel Service, the world’s largest delivery company, announced it will eliminate roughly 30,000 additional operational jobs in 2026, underscoring how tariffs, automation, and shifting trade rules are accelerating a painful transformation across the American workforce. The disclosure came during the company’s latest earnings call, as executives acknowledged growing pressure from rising costs and declining low-margin shipping volumes.

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Background

UPS executives said the job reductions are expected to occur largely through attrition rather than mass firings. Chief Financial Officer Brian Dykes told investors the company plans to offer a second voluntary separation program for full-time drivers, allowing workers to exit without formal layoffs. Even so, the scale of the cuts is significant, following a restructuring campaign that already eliminated approximately 48,000 jobs in 2025, including thousands of management positions.

A major driver of the downsizing has been UPS’s decision to reduce lower-margin delivery volume from Amazon. Company officials say that move alone generated roughly $3.5 billion in savings, but it also reduced labor demand across the network.

Union Backlash Intensifies

The announcement immediately reignited tensions with the Teamsters union, which represents the majority of UPS’s U.S. workforce. Teamsters President Sean O’Brien accused the company of sidelining workers despite strong profitability. In a post on X, O’Brien reminded followers that union members overwhelmingly rejected what he called an “insulting payoff” offer last year and warned UPS against violating its labor agreement.

The standoff signals renewed labor unrest at a time when many workers already feel vulnerable amid economic uncertainty and rapid technological change.

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Automation and Facility Closures

UPS confirmed it will permanently close 24 sorting facilities, adding to the 93 shuttered last year, as the company accelerates automation across its logistics network. Chief Executive Officer Carol Tomé highlighted the cost advantages of automated hubs, noting that the cost per package in these facilities is 28 percent lower than in conventional buildings.

The shift reflects a broader corporate strategy to rely more heavily on robotics and AI-driven logistics systems, reducing dependence on human labor even as shipping demand fluctuates.

Tariffs and the End of ‘De Minimis’

UPS is also being hit by the impact of higher tariffs and the closure of the so-called “de minimis” loophole, which previously allowed imports under $800 to enter the United States tariff-free. After President Donald Trump moved to shut the exemption, costs rose sharply for low-cost overseas retailers such as Temu and Shein.

UPS executives acknowledged that shipping volumes tied to those retailers are now less attractive, and the company is actively working to remove that business from its network. The policy shift highlights how trade enforcement decisions are reshaping supply chains — and employment — across the logistics sector.

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A Weakening Labor Market

The UPS announcement comes as cracks widen across the broader U.S. labor market. Revised government data shows the economy lost 173,000 jobs in October, the worst monthly performance since the pandemic, while December added just 50,000 positions. According to the Bureau of Labor Statistics, the U.S. added only about 584,000 jobs in 2025, marking the weakest year for employment growth outside a recession since 2003.

Corporate America Signals More Pain

UPS is far from alone. Last year saw a wave of layoffs across major U.S. firms. General Motors announced two rounds of job cuts in October, while companies such as Target, Procter & Gamble, and Walmart slashed thousands of mid-level corporate roles. The tech sector has been hit even harder, with Intel announcing plans to cut 25,000 jobs as automation and AI replace human workers.

Even corporate leaders are acknowledging the disruption ahead. Amazon CEO Andy Jassy warned last summer that artificial intelligence and automation would uproot thousands of American jobs, a prediction now playing out across multiple industries.

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Conclusion

UPS’s latest cuts are not an isolated corporate decision but part of a broader economic realignment driven by tariffs, automation, and profit pressures. As companies race to lower costs and governments tighten trade rules, American workers are increasingly caught in the middle — facing fewer opportunities, weaker job growth, and an uncertain future in an economy rapidly reshaped by machines.

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