xAI lays off 500 data annotators to build specialist AI tutors

Elon Musk's AI company xAI dismissed about 500 members of its data annotation team on Friday evening, notifying workers by email that their roles were being eliminated as part of a shift toward "specialist AI tutors," internal messages and company postings show. The layoffs, which affected roughly one third of a team that at peak numbered about 1,500, struck employees who help label and structure the data used to train xAI's Grok chatbot.

Company communications to affected staff said the move followed "a thorough review of our Human Data efforts" and indicated the firm would accelerate hiring of specialist tutors while scaling back generalist AI tutor positions. The company also posted on its social network that it would "immediately surge our Specialist AI tutor team by 10x," and invited applicants from fields including STEM, finance, medicine and safety to apply.

Employees said the termination emails promised pay through the end of their contracts or through November 30, but that their access to xAI systems was cut off the same day. Several workers reported that Slack accounts and other system access were deactivated immediately after notices arrived, and some senior staff had...