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AI talent is hard to come by these days, even for Elon Musk—and he knows more than a thing or two about that. The Tesla CEO and OpenAI co-founder has rendered his judgment on the mania in Silicon Valley for AI engineers, responding to a tweet about having to match an offer from OpenAI to keep one of his top AI engineers by describing the race to lock up skilled AI workers as “craziest talent war I’ve ever seen.”

AI is the hottest topic on Wall Street and in Silicon Valley, and tech companies are scrambling to fight for the sparse pool of workers with high-level AI experience. As Musk seemed to confirm, tTech giants such as Google, Apple and Meta are reportedly offering millions of dollars and juicy benefits packages to stay ahead of their competitors.

And Musk is an authority on the matter, with over a decade of work behind the scenes in the AI sector. If he’s not one of AI’s founding fathers, he was a major CEO present at the birth of the modern AI scene, and he participated in the talent wars that are still shaping the space. One such famous incident was part of how Musk and his longtime friend, Google co-founder Larry Page, became ex-friends—and involved Sam Altman, to boot.

The great AI talent shortage

The driving factor is a severe shortage of high-level AI talent. Naveen Rao, Head of Generative AI at Databricks, told the Wall Street Journal that there might only be a couple hundred people in the world with high-level qualifications and experience in training large language models and troubleshooting new AI platforms. 

The workforce is catching up: Many companies and top universities have recently started offering short-term training programs in AI, with some colleges adding new AI majors. But it could take years for new students to get up to speed, meaning in the short term, AI skill comes at a premium.

According to data sourced from the career-services platform Levels.fyi and reported by the Wall Street Journal, the median OpenAI salary came to $925,000, including bonuses and company equity. Meta AI engineers are making around $400,000, according to the platform’s database.

Hiring has been most competitive for the most qualified, highest-skilled AI workers. Musk’s comments were in response to a X thread about Ethan Knight, a Tesla machine learning scientist who Musk recruited to join xAI, his artificial intelligence company. Musk posted that Knight, the fourth Tesla engineer to join xAI, also got an offer from Sam Altman’s OpenAI.

“It was either xAI or [OpenAI],” Musk wrote. “[OpenAI has] been aggressively recruiting Tesla engineers with massive compensation offers and [has] unfortunately been successful in a few cases.”

The Sutskever incident

Back in 2015, Musk was involved in another high-profile AI hiring battle when he poached leading researcher Ilya Sutskever from Google Brain, offering him close to $2 million to join OpenAI, which Musk had co-founded as an ethical non-profit dedicated to developing an AI that would not threaten human civilization. 

According to Musk’s biographer, Walter Isaacson, he was in part motivated by a disagreement with the AI ideology of Google co-founder Larry Page, who led the development of Google Brain and later pivoted with the acquisition of DeepMind, then a leading force in the field. Page reportedly called Musk a “specieist” for insisting that humanity should always take precedent over some future, intelligent form of AI. 

Musk left OpenAI in 2018, leaving CEO Sam Altman in control with Sutskever in charge of research. Sutskever stayed with OpenAI as its chief scientist until last year, when he was one of the OpenAI board members who pushed Altman out as CEO after accusing him of not being fully transparent. Sutskever stepped down once Altman was reinstated following massive backlash from OpenAI employees.

In other words, if Musk says this talent war is the worst he’s ever seen, he’s seen a lot.

Tech companies need AI workers badly, and soon. After ditching its initial AI offering, Bard, Google is scaling up its Gemini AI model after stumbles related to historically inaccurate image generations. Apple’s iOS 18 update is expected to include new AI features once it releases in June. Last month, Musk open-sourced Grok, the AI chatbot developed by his company xAI. As new companies and models continue to proliferate, Ai engineer demand will likely continue to track upwards.

The AI hiring rush is coinciding with a waning, but still malingering, trend of layoffs in the tech industry. Tech sector downsizing peaked in the first quarter of 2023, when companies laid off around 90,000 employees, according to data from tracker layoffs.fyi. Cuts last quarter were less severe, but 60,000 tech workers still reported losing their jobs between January and March.


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