Is Twitter (Elon Musk) setting a bad example?

The very opposite. He is showing us, business owners, how to manage our businesses.

Well what do you mean when you say "bad example"? Is the implication that the example being set that the 90% of the employees weren't crucial in the first place which then allows other big companies to justify mass layoffs? I don't think most sane people would argue that majority of the big tech companies aren't incredibly bloated and that they wouldn't capable of moving far faster without the bloat. It's what makes startups so effective. From there, it's just a question of what do you want out of your company. Is it to move fast, occasionally break some things but come out ahead, or do you prioritise stability and not rocking the boat even if it means making that boat 10x bigger than necessary in order to carry 5 spares for every part just in case anything breaks.