Elon Musk: Tesla Will Reduce Headcount by 10 Percent, Freeze Hiring

Tesla CEO Elon Musk suggested the electric carmaker could reduce its headcount by 10 percent, according to a new report by Reuters.

In an email to Tesla’s executives, Musk also wrote that he had a “super bad feeling” about the economy, and ordered a pause in “all hiring worldwide,” the newswire stated. Tesla employs roughly 100,000 people.

Earlier in June, Electrik and Bloomberg both reported on another internal email in which Musk said remote work was “no longer acceptable” and “anyone who wishes to do remote work must be in the office for a minimum (and I mean *minimum*) of 40 hours per week or depart Tesla.” That missive made it clear that Musk believes managers are at their most effective when teams are physically present. (It also raises huge questions about what Musk would do if he succeeds in acquiring Twitter, as the social-networking giant currently allows its employees to work remotely.)

Given how many other companies have embraced remote and hybrid work, trying to enforce a mandatory return-to-office could potentially give Tesla some retention issues. In survey after survey over the past few years, technologists have emphasized their love for hybrid and remote work—and their willingness to leave a company that doesn’t offer a sufficient level of flexibility. If Musk thinks Tesla faces economic turbulence, he’ll need all the top tech talent he can get—but some of that talent might not want to stick around without flexible scheduling.

At least Tesla isn’t alone when it comes to hiring slowdowns: Meta, Snap, Coinbase, and other companies have announced hiring slowdowns or freezes over the past several weeks. The reasoning behind these strategies varies; for instance, social-networking giants have seen their ad revenues decline thanks in part to Apple’s ultra-stringent privacy regulations, leading to a renewed need to cut costs. On a macroeconomic level, though, there’s still strong demand for tech hiring.