Elon Musk Says Tesla Won’t Cut Jobs Despite AI Boom, Plans To Increase Hiring

Tesla CEO Elon Musk has identified an opposite path as major tech companies announce layoffs tied to AI adoption. Musk said Tesla’s goal is not to reduce its workforce at the Abundance Summit on Wednesday. Instead, the firm intends to up-hire while also radically boosting productivity per worker by deploying cutting-edge AI technologies and robotics. The comments come amid broader job cuts around the tech sector, many of which companies have linked to an accelerating adoption of AI tools.

Tesla Plans to Increase Workforce Despite AI Advancements

Also during an interview with entrepreneur Peter Diamandis at the Abundance Summit, Musk told attendees that Tesla has no plans to lay off employees.

"We're not planning any layoffs or reductions in personnel," he said. "In fact, we will increase our headcount."

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However, Musk added that artificial intelligence and robotics would dramatically increase employee productivity. "The output per human at Tesla is going to get nutty high," he noted.

Tesla is investing heavily in AI technologies and the Optimus humanoid robot programme, which the company believes could boost operational efficiency and productivity.

AI-Linked Layoffs Across the Tech Industry

Musk’s comments come at a time when several technology companies are cutting jobs as they restructure around artificial intelligence.

Some recent workforce reductions include:

- Block cut about 4,000 employees, almost 40 per cent of the company, and its chief executive officer, Jack Dorsey, pointed to AI tools as a major reason. The company’s stock reportedly jumped more than 20 per cent after the announcement.

- Atlassian, the Australian software company that makes Jira and Confluence, announced around 1,600 layoffs, or about 10 per cent of its workforce.

- Amazon has cut about 30,000 corporate jobs in recent months. AI efficiency gains would gradually trim the company’s corporate workforce, CEO Andy Jassy said in a memo in June 2025.

- Meta is reportedly mulling job cuts as high as 20 per cent of its nearly 79,000 employees so it can ramp up spending on artificial intelligence infrastructure that this year alone could reach $135 billion in capital expenditure.

Debate Over “AI Layoffs”

Not all layoffs attributed to AI may actually be caused by artificial intelligence. OpenAI CEO Sam Altman recently described a trend called “AI washing", where companies blame AI for layoffs that might have occurred anyway.

Salesforce CEO Marc Benioff echoed this view when discussing Block’s layoffs, saying: "That company has its own unique issues. We all know that, so let's put that aside."

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Analysts have also pointed to rapid hiring during the pandemic as a major factor behind recent job cuts. For example, Block expanded from about 4,000 employees in 2019 to nearly 13,000 by the end of 2023.

Mizuho analyst Dan Dolev commented: "The vast majority of these cuts were probably not due to AI."

Musk’s Long-Term Vision: Robots and Universal Basic Income

Despite Tesla’s current hiring plans, Musk believes the long-term impact of robotics and AI could fundamentally change the job market. At the Abundance Summit, he reiterated his prediction that robots may eventually handle the production of most goods and services.

To address that future, Musk again proposed universal basic income as a potential solution.

"We'll basically just issue money to people," he said, suggesting that rapid productivity growth could lead to effective deflation rather than economic scarcity.