Block’s layoffs should be a wake-up call on AI and jobs

In a week when the News Gods give us plenty of news, choosing the biggest is a fool’s game.

Was it Trump’s extraordinary State of the Union? Phenomenal Nvidia results that fail to answer questions about whether its massive hyperscaler splurge will result in significant profits down the line? Increasing tension between Iran and the USA?

Let me play dumb for a moment, because I think news from a mid-sized tech payments company could be a bigger warning of social upheaval and lead to longer-term tremors than other stories of the week.

Block, a $33 billion company, rose in extended trading Thursday after Twitter co-founder and CEO Jack Dorsey told the market it would lay off nearly half its workforce.

He wrote to shareholders that 4,000 of the 10,000 people had been “asked to leave or consulted.” Again: This is almost half its workforce!

Block CFO Amrita Ahuja said the layoffs will position the company “for the next phase of long-term growth.”

“At a time when our business is accelerating, we are choosing to change the way we work and see the opportunity to move faster with smaller, highly skilled teams using AI to automate more work,” Ahuja wrote.

Layoffs happen all the time, but what Dorsey said should be a wake-up call for everyone.

He said he expects other companies to similarly overhaul their workforces as they see further productivity gains from “intelligence tools.”

Get this straight: Dorsey expects other companies to do the same similarly overhaul the workforce As we see greater efficiency from “intelligence tools”

“I believe that within the next year the majority of companies will reach the same conclusion and make similar structural changes,” he wrote.

Do the math: From 10,000 to just under 6,000 jobs are being replicated in industries across the country and around the world.

So it’s a new, growing company, not an old economy business, that said companies will make massive cuts to their workforces as new intelligence tools become more widespread.

I keep being told on CNBC that AI will create new jobs to replace those lost. I’ve been asking the same question for years. “What are these jobs? Where are the backlogs for the millions whose roles will be made redundant?”

And every time I hear the same old trope: “oh, those jobs haven’t been created yet.”

I think it’s time we got a better answer, right?