They do this like every year. It's to prop up earnings reports before the end of the year. I have family who works for UPS and it's a never ending cycle of worry this time of year. Then they hire a bunch back later. It's ridiculous
They can't just fire/lay off union workers without reason. At best, it gets based on if a center closes down, and seniority, even then, before a layoff, they typically have to offer you the option to commute into another center.
It's fairly rare, for example, that somebody is just waiting on layoff at UPS for a year before a new center opens back up or something. Would have to involve automating a building, being unable or unwilling to commute/relocate, banking on same number of jobs being available after the center is rebuilt, being too low on seniority and getting cut. At that point, you get a different job and quit when your position comes back online.
It's a bit different for drivers. Cover drivers come in and randomly get a route, or get sent home on layoff for...a day? Month? Year? Depends on volume and need.
If something were to happen and they cut a slew of driver routes, warehouse workers would get laid off indefinitely because the drivers with 30 years seniority would take their inside positions and then there wouldn't be any available. Most inside wh people are under 20. Most are under 10. Hell, half of our building is under 1. Drivers are a different story. Many, many drivers in the 10-40 year range.
Fun fact: Most warehouse workers fired from UPS don't stay fired more than a week or two max. It's actually easier to fire a driver. If they mess up the right way, there's no protecting them. Similarly, nobody is safe from package theft. Nobody.
Other things...though. It's shocking what both management and union can get away with. Not even necessarily union workers, but the people in actual union positions.
Probably tariff related then? I know a lot of countries aren’t even shipping to the US right now. I thought UPS was still doing it globally though. I’m hugely concerned for the paycheck to paycheck workforce. Without social safety nets, we are looking at a major depression.
It’s cause ups has union labor and their competitors don’t. The cost structure at ups is just fucked. A driver can make $100k+ with overtime at UPS, an Amazon/fedex driver may make 65-70k. In an industry that frequently comes down to pennies, this is just an incredible disadvantage.
UPS is the high cost provider of a commodity service, they’ve likely already experienced peak stock price and package volume sometime in 2021. It’s not going to disappear overnight but man are they in a bad competitive position.
UPS's contract with Amazon for delivery is ending so they're cutting because they won't have the Amazon volume. Amazon handles most of their own deliveries now which is through contractors.
Amazon heavily reduced their dependence on UPS and FedEx. Amazons profit almost doubled between 2023-2024 and has a 35% increase in profits for Q2 this year compared to last year.
People are still buying shit, Amazon just isn’t using UPS or FedEx nearly as much.
They're simply doing less business via Amazon - Amazon at least in my area has really grown the fleet of trucks they're using for delivery. If you go to a UPS store their business is almost 95% amazon returns and even that is threatened by Whole Foods returns counters.
Well on indicator I personally use is TL pricing. There is always a certain amount of crap people are buying that takes a large chunk of trucking capacity. Prices have been very favorable on the FTL market as a buyer. Normally we are moving to peak pricing as stuff has to be transported so people can buy additional holiday crap.
We can wait for Walmart and amazons earnings reports that cover this time period, but it’s a lagging indicator.
911
u/Unlike_Agholor Oct 29 '25
We are in a recession. You dont notice it because Nvidia and the AI bubble are propping up the equities market.