How Many Employees Should Elon Musk Let Go?

Question: How many workers are needed to manage a technology company?

Answer: Elon Musk.

But in all seriousness, how many people does it actually need to run a digital company—let alone develop one?

This question is important right now because it speaks to the wave of layoffs currently affecting Silicon Valley and the tech industry as a whole, in addition to Elon and Twitter.

While eliminating 50% of a company's employment during a recession makes it reasonable, it also begs the question of how so many employees were hired in the first place. What did every one of them do? And going back to the original query, how many are actually required?

Starting with Twitter, whose statistics are genuinely astounding,

As you've probably read, Elon took over Twitter last month with 7,500 employees, and he fired nearly half of them right away. After a few weeks, he reportedly ordered the remaining employees to either commit to being "hardcore" or quit. As a result, about 1,000 people are said to have quit, leaving Twitter with 2,700 staff members, according to the Verge. All of this has led many to forecast that Twitter will soon crash. It hasn't thus far.

Elon Musk the founder of Tesla attends Offshore Northern Seas 2022 in Stavanger, Norway on August 29, 2022. NTB/Carina Johansen - REUTERS

Although I'm not a huge admirer of Elon's managerial style, which appears to be in part about channeling his inner 13-year-old kid, it does make you wonder: if the neighborhood dairy fired half its employees, I bet some customers wouldn't be getting milk the following day.

Chad Hurley, a co-founder of YouTube and a PayPal mafioso alongside Elon Musk, tweeted during Musk's bloodletting: "I don't know who needs to hear this but Craigslist has been [sic] running for the last 20+ years with a crew of 50 people."

True, but the comparison is apples to oranges. Compared to Twitter, Craigslist is smaller and offers fewer features. Hurley's tweet does, however, allude to Musk's apparent query on Twitter, namely, "How much functionality do digital consumers truly need?"

Let's look at what's happening at some other IT companies to aid with that.

11,000 Meta employees were just let go. 10,000 employees will reportedly be let go by Amazon.

According to Allie Garfinkle of Yahoo Finance, Google may be the next company to announce layoffs after activist investor Chris Hohn complained last week to Alphabet CEO Sundar Pichai that his "company has too many people." It is thought that Google may fire 10,000 workers.

Kara Swisher and Sundar Pichai speak on stage Vox Media's 2022 Code Conference - Day 1 on September 06, 2022 in Beverly Hills, California. (Photo by Jerod Harris/Getty Images for Vox Media)

With 164,000 employees, Apple, which let go of 100 recruiters in August, seems to be holding steady for the time being.

According to Layoffs.fyi, over 137,000 tech workers have lost their jobs overall this year.

I would contend that although staff and marketing positions certainly accounted for the majority of these losses, redundancies can also occur in line operations. It's no secret that some key technological work provides customers, businesses, or the economy with little to no value.

Consider all the product improvements and additional features that Google has introduced to Gmail and other products, only to make them more confusing rather than better. Hohn also points out in his letter to Pichai that Google's 'other bets' businesses had collectively lost $17 billion.

According to Apple, configuring a brand-new iPhone used to require twenty minutes. It took a lot longer and I just got an iPhone 14. The phone still pokes and prompts me even after the initial setup. For instance, it notifies me that my iPad is still at home when I leave my flat. Is the extra time it takes to log in and register worth the benefit I now get from the new phone? In my opinion, no.

Then there are all of the features, programs, and products that you have never heard of because they were abandoned or silently killed off before they could enter the market.

I see the necessity for experimentation among engineers and product managers. Just the method, which encourages engineers to "disrupt," "pivot," "move fast and destroy things," and "fail fast," has gone too far in today's highly empowered tech culture.

For the top 1% of technical personnel, this method of operation may make sense, but not for the tens of thousands who have been given the keys.

The head economist at ZipRecruiter, Julia Pollak, asserts that there is a law of large organizations. "You form a team to address a particular issue at hand, and the team continues to function even after the issue has been resolved. As a result, the team ends up being a team looking for a problem.

However, I think that many Silicon Valley businesses have appallingly low staffing levels in one particular department: customer service. and Meta, formerly known as Facebook.

Facebook and Instagram serve almost 3 billion users per day, according to a Wall Street Journal report from May, "with a help desk that counts closer to zero." And to make matters worse, a more recent, unnoticed WSJ article depicts a renegade cottage economy of hackers and ousted Facebook employees who secretly assisted clients who had nowhere else to turn, occasionally in exchange for bribes and cash payments.

Because they are expensive and viewed as unneeded in a culture devoted to algorithms and software tools, Meta has shied away from employing customer care representatives.

What ambitious product manager or engineer would want to work in customer service when they could instead develop new features, goods, and services with little supervision or accountability?

In the end, though, I'm leery about significant layoffs. In actuality, practically all businesses have "too many employees."

Yes, it is possible to fire 100 workers from a factory that employs 500, and private equity investors have made tens of billions of dollars in America doing just that. But what follows?

To me, Musk's extreme employment cuts have the smell of Randism that has been overdone. Every generation creates business leaders with brilliant ideas who also disguise their power moves as economic revolutions, like Elon Musk.

But there is an ideal, always-changing amount of tech employment that fits somewhere between Elon's Great Manism and Google's other bets. Why not give that some more thought as well.