Block CEO Dorsey Says AI Will Replace Half His Workforce, Warns Others to Follow

Block CEO Jack Dorsey announced plans to eliminate over 4,000 jobs, nearly half the company's workforce, citing artificial intelligence as the primary reason. His blunt warning that AI tools allow smaller teams to accomplish more work has intensified the debate over whether AI helps workers or replaces them entirely. The announcement comes as companies worldwide have cut more than 61,000 jobs linked to AI adoption since November.

Block CEO Jack Dorsey isn’t just talking about artificial intelligence changing the workplace – he’s acting on it in a way that’s grabbing attention across the business world.

The co-founder made waves Thursday when he announced plans to eliminate more than 4,000 positions, representing nearly half of the fintech company’s staff, as part of a major restructuring to integrate AI throughout the organization.

“Intelligence tools have changed what it means to build and run a company. We’re already seeing it internally. A significantly smaller team using the tools can do more and do it better,” Dorsey stated in his announcement.

He didn’t stop there, delivering a stark message to other business leaders about the technology’s impact. “I don’t think we’re early to this realization. I think most companies are late,” he declared, predicting that other firms will reach similar conclusions within twelve months.

“I’d rather get there honestly and on our own terms than be forced into it reactively,” Dorsey added.

Wall Street responded favorably to the news, with Block’s stock price jumping Friday as investors increasingly favor companies positioning AI as a fundamental business transformation rather than just an experimental tool.

The announcement has intensified an ongoing discussion among business leaders, financial experts, and government officials about AI’s true role: Does it enhance human productivity, or does it enable organizations to operate with dramatically fewer employees?

Data shows AI-related workforce reductions are becoming more common globally. A Reuters analysis reveals that since November, companies have announced over 61,000 job eliminations connected to artificial intelligence implementation, including major corporations like Amazon, Pinterest, and Australia’s Wisetech.

However, Block stands out as one of the most prominent companies to identify AI as the main catalyst for its cuts, rather than treating it as a secondary efficiency measure.

Some market watchers suggest these automation-driven reductions are partially addressing years of excessive hiring practices. Brian Jacobsen, chief economic strategist at Annex Wealth Management, commented Friday that “AI is the new scapegoat.”

Nevertheless, financial markets are growing increasingly concerned about AI’s potential to disrupt employment and corporate earnings amid global economic uncertainty.

A prominent research report released this week by Citrini Research projected a troubling 2028 scenario where unemployment could reach 10.2%, fueled by rapid job displacement in software development, logistics, and delivery sectors.

Despite these concerns, evidence suggests companies are beginning to see concrete returns from their AI investments. Morgan Stanley analysts reported this week that an increasing number of firms are documenting measurable benefits from AI implementation, based on their examination of over 10,000 earnings calls and fourth-quarter conference transcripts.

The analysis showed 21% of S&P 500 companies cited at least one quantifiable advantage, rising from 15% in the third quarter and 10% in the final quarter of 2024. The analysts project that expanded AI usage will increase corporate profit margins by 40 basis points this year.

Until now, most executives and policymakers have taken a more cautious approach than Dorsey when discussing AI’s employment implications.

European Central Bank President Christine Lagarde told a European Parliament committee Thursday: “What we are seeing for the moment is that it’s increasing productivity. But we are not yet seeing consequences in terms of labour market and waves of redundancies that are feared, and that you know we will be extremely attentive going forward.”

At last month’s World Economic Forum, JPMorgan Chase CEO Jamie Dimon acknowledged that jobs would vanish but emphasized that new positions would also emerge.

Bank of America global economists Claudio Irigoyen and Antonio Gabriel stated Friday that AI could ultimately impact 25% of all employment positions. They argued that while the AI transformation will be disruptive for companies that fail to adapt and workers who lose their jobs, the overall economy will benefit through the creation of new employment opportunities and business ventures that were previously unfeasible.

Michael Ashley Schulman, partner and chief investment officer at Running Point Capital Advisors, cautioned against dramatic measures like Block’s approach.

“Dorsey’s strategy suggests that less is more and that human capital has lost its competitive edge,” Schulman observed. “The question is whether the company is resetting to its smaller, nimbler startup days or whether it might lose the creativity and human intuition that built its most iconic products in the first place.”