Elon Musk's xAI lays off 500 employees in major restructuring
Elon Musk's AI company, xAI, just let go of about 500 people from its data annotation team—the group that trains its Grok chatbot.
The news landed in inboxes Friday night, with pay continuing through contracts or until November 30, but employees lost access to company systems right away.
Shifting focus to domain-specific specialists
xAI is moving away from having a huge team of generalist AI tutors (over 1,500 people making $35-$65 an hour) and now wants more domain-specific specialists to help Grok learn faster.
The layoffs followed a series of one-on-one meetings where employees were questioned about their work, echoing Musk's reputation for tough internal reviews.
Plans to grow specialist tutor team
Even after these cuts, xAI actually plans to grow its specialist tutor team by 10 times. This comes after some leadership changes too (the finance chief left in July).
Meanwhile, Grok stands out with a bold social media vibe—very different from the usual "safe" chatbots—which lines up with Musk's push for less censorship and more open conversation.