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Block Lays Off 40% Of Workforce
Blocked out // Illustration by Kate Walker
Last week, Jack Dorsey’s Block — the company behind Square, Cash App, and Afterpay — laid off roughly 40% of its workforce… despite being a strong and profitable business.
Why It Hurts: So, what’s behind the housecleaning at Block? AI, of course. It’s part of the white-collar workforce shrinkage that AI leaders have been warning about for the past couple of years — and it could totally reshape the makeup of companies across nearly every industry.
Between The Lines: In his infamous no-caps writing style, Jack Dorsey let the world know he was cutting his company’s headcount nearly in half — from 10,000 to under 6,000.
Dorsey posted on X that AI has made his employees more productive — and rendered many positions obsolete.
Instead of laying people off in rounds of cuts (or even more rounds of cuts), he’s ripping off the Band-Aid — while offering a solid severance package to help ease the pain.
Moving forward, Block will operate with “smaller and flatter teams” that have AI at their core.
Block’s stock jumped 20% on the news, with shareholders clearly happy about the prospect of continued growth with lower costs.
Closing Thoughts: No surprise, but Silicon Valley had plenty of thoughts about Dorsey’s decision — including calls to help people become entrepreneurs to offset a shrinking workforce, fears that tech companies will continue to rise in value while the broader economy struggles, and predictions that more companies will follow Dorsey’s lead to signal to investors that their AI strategy is solid. Case in point: Klarna CEO Sebastian Siemiatkowski has cut the payments company’s headcount in half over the past four years… and is boasting he’s not done yet.
But hey, the World Economic Forum predicts that while 92 million people will lose their jobs to AI by 2030, 170 million new roles will be created… even if some of them end up double-checking the work AI agents do.
The Future: Expect calls for a universal basic income to grow over the coming year. After all, people still need to pay their bills.
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Today’s email was written by David Vendrell.
Edited by Nick Comney. Polled and Copy-edited by Kait Cunniff.
Published by Darline Salazar.