Workers, Get Ready for the Great Rebalancing
This may be the year when employer-employee power dynamics begin to normalize
2 min
American workers’ wild ride is coming to an end.
After three whiplash-inducing years of, first, professional vulnerability and, then, perceived invincibility, many people are returning to more typical levels of career security and leverage.
Call it the Great Rebalancing of the employer-employee relationship.
“We’re clearly headed there,” says Heidi Shierholz, president of the Economic Policy Institute.
Not long ago, at the pandemic’s onset, things were so bad that people lost jobs in record numbers as the U.S. unemployment rate reached 14.7%. Then things got so good that workers resigned in record numbers. There was a catchy name for this trend, I believe.
Adding to the volatility, savings swelled and shrivelled with the stock market, causing some people to lurch between hope for an early retirement and fear of working forever. Raises that made some feel flush were offset by inflation, in many cases.
The “quiet quitters” who reduced their on-the-job efforts while feeling untouchable last year may now be angling to fill key roles when their companies freeze or cut head counts.
Ms. Shierholz says that workers are still in good shape, overall, but certain key metrics are trending down toward normal ranges. December’s hourly earnings increase of 4.6% from a year earlier was the smallest rise since mid-2021, and the 223,000 additional jobs were the fewest per month in two years.
To complain about such decreases would be akin to griping if Yankees slugger Aaron Judge were to hit only 50 home runs this year, after smacking an American League-record 62 last season. It’s unrealistic to expect new peaks all the time, and it’s worth remembering what 2020 was like. (Mr. Judge, beset by injuries, hit 9 homers that year, by the way.)
Francesco Carucci, a California software developer, says he knew that his pay package was “wildly inflated” when he joined Meta Platforms Inc. last January. He says Facebook’s parent company tripled the total compensation that he earned at his previous employer, amid a hiring spree in a historically tight labor market.
Then Meta laid off Mr. Carucci late last year in a round of 11,000 job cuts. Being aware of his bloated comp didn’t dull the sting of losing it, he says, and he got an additional reality check this month when he accepted an offer that is worth half of the one he received a year ago.
Still, he says his new pay is reasonable—more than what he made a few years ago—and the interview and negotiation process was more in line with what he has usually experienced over a 25-year career. He adds that he’s trying not to take the layoff personally. He views it instead as part of a natural and inevitable correction to the job market.
Others would do well to practice the same attitude. Andy Challenger, senior vice president of Challenger, Gray & Christmas, which helps companies manage layoffs and provides career coaching to the dismissed, tells me that business is picking back up after two of the slowest years in the firm’s history. He offers a blunt translation of what that means: “We know that there are a lot more layoffs coming.”
Ominous as that sounds, Mr. Challenger says the prospects of finding new work are generally good. Job openings, while shrinking, still outnumber the unemployed by several million, according to federal data. He expects that gap to narrow as the year goes on and advises job seekers to redouble their urgency.
“It’s not a time to lay back and feel too comfortable about the tight labor market,” he says. “Even if you’re getting lots of messages from recruiters today, that can dry up pretty quickly as things turn.”
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From making unpopular decisions to learning when to listen, leaders from five businesses reveal what nobody prepared them for — and how running a company has challenged their expectations.
Technology and semiconductor shares fell sharply as investors questioned the debt financing the AI infrastructure boom and confronted higher rates and Chinese competition.
Elon Musk is exploring a potential merger between Tesla and SpaceX, a deal that could reshape the future of AI, robotics, autonomous vehicles and space technology. With a combined valuation potentially reaching $3.5 trillion, the move could bring Musk’s vision of an interconnected technology ecosystem closer to reality, although a deal remains uncertain.
5 min
Elon Musk has engineered ties between Tesla TSLA 3.41%increase; up pointing triangle and SpaceX SPCX 7.79%increase; up pointing triangle that are hard to break, and now he wants to fuse them together permanently.
Musk has run both Tesla and SpaceX concurrently over the past two decades, using a schedule that dictated which days he spent focused on each business.
The companies have often shared resources and personnel, signaling their close ties. Last year, SpaceX looked into creating a spacesuit for Tesla’s humanoid robot Optimus, a person familiar with the matter said. Tesla last week showed off its new Roadster, a vehicle featuring SpaceX rocket thrusters that it hopes to soon bring to market.
And in recent months, Musk has repositioned both companies by expanding beyond their core operations toward a shared mission centered on artificial intelligence.
The world’s richest man on Tuesday signaled his interest in tying up SpaceX and Tesla, marking what would be the biggest corporate merger of all time. Because he serves as chief executive of SpaceX and Tesla, Musk said committees of independent directors at both companies are evaluating a possible deal, adding that a transaction might not come to fruition.
The committees will likely evaluate, with lawyers and bankers, how each company would fare in a potential deal and how a deal might best be structured. They then present their conclusions to their respective boards, who typically vote on whether to proceed.
“It’s an odd Kabuki dance where two groups of people are talking and I can’t be in the conversation,” Musk told SpaceX investors on Tuesday in response to an analyst’s question about a potential deal.
For Musk, the merger supports his vision of a world full of autonomous cars, humanoid robots and weekly rocket launches, as well as the data centers and satellites required to keep the whole thing running.
Some investors and analysts said they expect a transaction would be structured as an all-stock deal, with SpaceX potentially paying a modest premium for Tesla shares.
SpaceX, which has a market value of about $2 trillion, said it is seeing sharp growth in revenue across its businesses, which include operating data centers, launching rockets and operating satellite networks such as the internet service Starlink. Tesla is valued at about $1.5 trillion and is expanding its operations beyond its automotive and energy business. Shares in both companies traded higher following the news Tuesday.
Musk’s substantial ownership stakes in both companies, along with voting control at SpaceX, has enabled him to set the deal in motion. Analysts and investors said the deal will probably face regulatory scrutiny internationally, though some see Musk’s close relationship with the Trump administration as an asset to getting approval.
Blurred lines
The companies haven’t said which directors are on the special committees evaluating a potential deal. Several SpaceX and Tesla board members have either personal or business ties to Musk. And like Musk, venture capitalist Ira Ehrenpreis sits on both boards.
In a filing this week, Tesla outlined millions of dollars in business agreements with SpaceX and its subsidiaries last year, including $143 million in car sales to SpaceX, $3.3 million in advertising that it bought on the social-media platform X and $430 million in revenue from the sale of Megapack batteries for SpaceX’s data centers.
The companies also split the cost of resources including the use of Musk’s SpaceX jet and the bill for his personal security, which he runs through a private company.
Employees at both companies routinely move between companies to work on special projects, and some executives have dual roles, including Charles Kuehmann, vice president of materials engineering at both SpaceX and Tesla, and Ashok Elluswamy, the vice president of AI software at Tesla who runs a joint venture with SpaceX called Digital Optimus.
Over the years, Musk has launched new startups within his empire, including brain-implant company Neuralink, underground-tunnel developer the Boring Company and xAI, the AI startup that merged with SpaceX in February.
It is that AI business that Musk thinks can serve a market worth tens of trillions of dollars, justifying the need for a merger.
The business case goes like this: Tesla is developing robotaxis and robots, which it calls “physical AI.” SpaceX is working on the back end of physical AI: the data-center capacity and internet connection required for those robotaxis and robots to operate continuously.
“I don’t see what the value of Tesla is if it’s not merged with SpaceX,” said investment adviser Ross Gerber, a former Tesla bull turned critic invested in both companies. “If they don’t merge, the brains of everything that runs Tesla is owned by another company.”
On top of it all, both companies face constraints on the supply chains they need to make this world a reality, particularly when it comes to chips. To address this, Musk earlier this year announced a joint venture between Tesla, SpaceX and Intel to design and manufacture chips in Texas. “The most epic chip-building exercise by far,” he has said.
Musk at the wheel
For Musk, a merger would also solve two problems: demands on his attention and his lack of control at Tesla.
Tesla for years was Musk’s only public company, a status that came with greater scrutiny. There, Musk reports to a public board, as well as individual investors who make up around 30% of Tesla’s voting power, according to FactSet.
The question of Musk’s attention became a particular focus for investors and the board in recent years after he acquired Twitter in 2022 and launched xAI in 2023, and again in 2025 as he spent time in Washington, D.C., running the Department of Government Efficiency in the early months of President Trump’s second term.
As Tesla’s car business suffered in 2025, Musk threatened to take his AI ambitions outside the company if he wasn’t granted 25% voting control. Last November, Tesla shareholders approved a new pay package for Musk, which created a path for him to vastly expand his stake.
As of Sept. 30, Musk owned a roughly 20% stake in Tesla, according to the company’s proxy filing.
The SpaceX IPO gave Musk a different path. When SpaceX went public in June, the deal’s structure enabled him to have more than 80% voting power at the company—so much that he can’t be fired and decisions can’t be made without his support.
If SpaceX acquires Tesla, he will likely stay in control.
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