Main image of article Tesla Faces Layoffs, Hiring Freeze: Report

Tesla may implement a new hiring freeze and layoffs, according to a new report.

Although the electric car maker needs to hire workers for its new factories in U.S. and Germany, it also plans on cutting staff in the first quarter of 2023, stated Electrek.

“On Twitter, [CEO Elon] Musk has been talking a lot lately about macroeconomic trends and laughed at claims that his Twitter antics are the reason for Tesla’s stock price dropping,” the publication added. “Instead, he blames mostly the fed’s rate hike.”

If this report is true, Tesla wouldn’t be the first tech company to cut people due to fears of an economic recession. Over the past few months, a range of tech giants—from Meta to the Musk-owned Twitter—have sliced staff in an attempt to reduce budgets and prepare for a possibly turbulent future.

On the workplace front, Tesla made waves earlier this year when Musk instituted a “no remote work” policy. “Tesla has started sending emails to those that don't show up 16 days minimum in the month,” one anonymous poster wrote on Blind, a forum that allows technologists to post anonymously about their workplaces. “The email directs you to email your boss with an explanation and copy the absence tracking group.”

At the time, Musk argued in an internal email that the most effective managers are physically present in the office as much as possible. “The more senior you are, the more visible must be your presence,” he reportedly wrote. “This is why I lived in the factory so much—so that those on the line could see me working alongside them. If I had not done that, Tesla would long ago have gone bankrupt.”

That elimination of remote work ran contrary to the policies at other tech companies; Google, Apple, Airbnb, and other tech giants have widely embraced hybrid and/or remote work. In multiple surveys over the years, technology professionals have indicated they don’t want to come into the office five days per week, and some pundits thought that Tesla’s policy might harm its ability to secure top tech talent.

Whether or not a deep recession actually hits, companies like Tesla will need to continue hiring top tech talent to achieve ambitious goals. The current burst of layoffs will hopefully transition to a new hiring cycle sooner rather than later.