Elon Musk's xAI lays off 500 people training its Grok chatbot

Elon Musk’s artificial intelligence startup xAI has laid off 500 workers from its data annotation team, which helps train its Grok chatbot.

The layoffs were earlier reported by Business Insider.

The AI company notified employees over email that it was planning to downsize its team of generalist AI tutors, according to messages viewed by the publication. The company said the “strategic pivot” meant prioritizing specialist AI tutors, while scaling back its focus on general AI tutor roles.

In response to the story, xAI directed reporters to a post on X, in which the company said it plans to expand its specialist AI tutor team by “10X” and intends to open roles on its careers page.

The human data annotator team at xAI plays a key role in teaching Grok to understand the world by labeling, contextualizing, and categorizing raw data used to train the chatbot. The email sent by xAI said that laid-off workers would be paid through either the end of their contract or Nov. 30, but their access to company systems would be terminated the day of the layoff notice.

Prior to the layoff, the xAI’s data annotation team was one of the largest, with 1,500 full-time and contract staff members, which included AI tutors. The reorganization of the data annotators team comes on the back of a leadership shake-up at the team that saw nine employees reportedly exit the firm last week.

As a sign of its changing approach to training Grok, xAI on Thursday asked some of the AI tutors to prepare for tests, Business Insider reported, that covered traditional domains such as STEM, coding, finance, and medicine, as well as quirkier specialties such as Grok’s “personality and model behavior” and “doomscrollers.”

Musk launched xAI in 2023 to compete with OpenAI and Google DeepMind, which are battling to win the AI race. He introduced Grok as a safe and truthful alternative to what he accused competitors of building, “woke” chatbots prone to censorship.