Tesla is reportedly implementing a hiring freeze and will be conducting another round of layoffs next quarter.
The electric vehicle company has already told some employees about the hiring freeze, although it isn’t yet clear how expansive that freeze will be considering Tesla’s planned expansion at some manufacturing locations, according to Electrek.
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It is also not clear how many employees will be cut in the first quarter of 2023 or what teams those cuts will affect. Tesla did not respond to a request for comment on the reports.
This isn’t the first time in the past year that Tesla has dialed back hiring. In June, CEO Elon Musk said in an email to Tesla executives that he had a “super bad feeling” about the economy and wanted to slash about 10% of the company’s workforce. All hiring was also paused.
Musk reversed course on the summer hiring freeze, and the company began a hiring rebound in the second half of this past year.
News of the fresh hiring freeze and layoffs comes as the economy inches toward the likelihood of a recession. The Federal Reserve has been jacking up interest rates all year, a move designed to slow inflation but is also meant to slow spending, raising the likelihood of a slowdown.
Many economists are forecasting a recession sometime in the middle to late part of 2023, which would undoubtedly result in layoffs and lost jobs across a broad swath of the economy.
Even in May, Musk was predicting that a recession is in store for the country, although he said it would be a net positive.
“Yes, but this is actually a good thing. It has been raining money on fools for too long. Some bankruptcies need to happen,” Musk said. “Also, all the COVID stay-at-home stuff has tricked people into thinking that you don’t actually need to work hard. Rude awakening inbound!”
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Other companies such as Cisco and Goldman Sachs have already announced layoffs as the specter of a recession looms large.
Economic modeling by Bloomberg assigned a 100% chance of a recession occurring by next October, and the Conference Board, based upon its probability model, also predicted a 96% chance of the economy entering into a recession in the next 12 months.
