From Block to Amazon: how AI has already supplanted 120,000 jobs
According to the independent tracker Layoffs.fyi, the technology sector will cut more than 120,000 jobs globally by 2025
Block cuts 40% of its workforce in one fell swoop. This was announced by CEO Jack Dorsey, former ceo of Twitter and founder of the digital payments company that started out as Square, when he announced the reduction of around 4,000 employees out of just over 10,000 global staff. The workforce will drop below 6,000 people. The reaction of the markets was immediate. Block's stock jumped 15% (with an intraday high of 25%), a sign that investors interpreted the cut as a structural reorganisation decision. In a phase of more moderate growth for the tech sector than in pandemic years, Wall Street tends to reward companies that show cost discipline and the ability to quickly adapt their operational structure.
Dorsey explained the decision in a shareholder communication and in a series of posts on X, placing the role of artificial intelligence at the centre of the argument. "Intelligence tools have changed what it means to build and run a business," he wrote. "We are already seeing this internally. A significantly smaller team, using the tools we are creating, can do more and do it better. And the capabilities of these tools are growing every week."
The reference to intelligence tools indicates a broader organisational transformation. Dorsey describes tools capable of performing cognitive functions traditionally entrusted to skilled personnel. Artificial intelligence thus becomes an element that directly affects the optimal size of an enterprise. "The tools we are creating and using, combined with smaller, flatter teams, enable a new way of working that fundamentally changes what it means to build and run a business."
The message also includes an assessment of recent years: 'Yes, we hired too much during Covid'. Like many technology companies, Block had rapidly expanded its workforce during the boom in digital payments and online services. As the business cycle normalised, those structures became less efficient in comparison to the new possibilities offered by intelligent automation.
Dorsey then indicated a broader perspective. "By next year, I believe the majority of companies will come to the same conclusion and make similar structural changes," he wrote, adding that "most companies are lagging behind" in adapting organisational models to Ai capabilities. Block's cut is presented as a step that will spread to the rest of the industry.
