Mark remembers the first time he wondered whether he was teaching Block’s AI tools how to do his job – and maybe even replace him. He was at his fintech company’s extravagant anniversary party last September. As executives led a presentation on the productivity benefits of a new internal AI tool, Mark, who worked in the product department, discussed his worries with colleagues. While he wasn’t sure what would happen in a few years, he told a co-worker sitting next to him that for now, there was no way the technology was so advanced that it could move the business forward without employees like him to help drive vision and strategy.
These AI tools were not proactive. He had to tell them what to do. Block still needed him, he thought.
“You can’t really AI that,” he told the Guardian, adding that, after all, “an employee is more than a series of tasks”.
Mark was one of roughly 4,000 Block employees laid off last week. CEO Jack Dorsey said he cut the company’s workforce almost in half because of gains in AI productivity. “A significantly smaller team, using the tools we’re building, can do more and do it better,” Dorsey wrote in a letter to shareholders.
But in interviews with the Guardian, seven current and recently laid off workers pushed back against Dorsey’s assertions that current AI tools can essentially replace workers at this scale. The workers the Guardian spoke with requested anonymity for fear of jeopardising their jobs or severance. They belong to various departments, including engineering and product, and several say Block’s AI tools can be helpful in their work. But many felt the cuts were Dorsey’s way of winning back investor confidence after Block’s stock had declined in recent months, following heavy investments in an unstable cryptocurrency market.
George, who still works at Block, says this was “posturing for the market” and that investors believe Dorsey is not a strong CEO: “This was a bold move to reposition the company away from crypto and towards AI and also change the public market narrative around the company.” Block’s stock jumped after its AI-fueled layoff announcement.
In a wide-ranging Wired interview published Friday, Dorsey said he cut his workforce so drastically because “something really shifted in December in the sophistication of [AI] tools, including Anthropic’s Opus 4.6 and OpenAI’s Codex 5.3”. He pushed back on claims of over-hiring during the Covid-19 pandemic, saying that the company was “in line with or just ahead of all our peers” in terms of gross profit per employee. He said the structure and management hierarchy of companies is “getting in the way of everything we do”. His goal, he told Wired, was for “the company itself to feel like a mini AGI”. Block did not provide a statement to the Guardian.
Block’s cuts come as wider fears emerge about how a growing use of AI in the United States could drive job cuts. Goldman Sachs noted in February that the increasing pace of AI adoption could drive up unemployment this year and estimated that the technology had already resulted in 5,000 to 10,000 monthly net job losses in the US last year.
Creating their own replacements
At first, Block mostly encouraged its employees to use AI more often. Then, over the last nine months, that encouragement shifted to a requirement, workers told the Guardian. Dorsey insisted in a recording of a January internal all-hands meeting that the Guardian reviewed that “the way we built things in the past is not going to work anymore”.
“We have to shift. There’s no question,” Dorsey said.
Some workers, including Mark, feel that employees are being tasked with building and training the very tools the company is trying to use to supplant them.
“The way in which they are using these tools as justification to fire half the company is ludicrous,” he said. “In hindsight, it seemed like a thinly veiled attempt to get all this input from employees on what tasks to automate. You basically have employees teach you how to automate them out … but [these tools] are not even close to being all-encompassing of someone’s job.” Another laid-off Block employee made a similar point publicly in an interview with Business Insider.
Even Block workers whose jobs heavily involve AI tools are skeptical that current tools can replace workers at this scale. “We’re just not there yet,” says John, a current employee whose role involves helping other staff use AI.
“There’s a distinction between what’s technically possible and just – pardon my French – whatever CEO bullshit will happen based on their own interpretation of how AI works,” John says.
While AI tools have certainly made engineers faster, humans still need to be a part of the loop. Block executives said in a recent earnings call that the company has “seen engineering work that would have taken weeks to complete be done by a small team in a fraction of the time with agentic coding tools”. They cited a “greater than 40% increase in production code shipped per engineer since September”.
All code changes at Block require human approval before being added to products and services, according to John. He notes that about 95% of AI-driven code changes still need human tweaks – as of about three months ago. “They are not up to company standard on the first try,” he says.
Block is also monitoring employees’ use of AI, down to their use of specific tools and tokens, according to several employees. Evaluations about employee performance, which are determined partly by the direct manager’s assessments, now include questions about AI usage and proficiency.
Liam, a recently laid-off software engineer, recalls feeling the pressure as his manager asked him about how he currently uses AI and what steps he would take to make that more effective. “It was very clear that if you weren’t using AI, your job was in danger,” he says.
The push for rapid change has led to a widespread feeling of AI fatigue, according to John, who helps others use these tools: “People are fed up with AI.”
Carl, a current employee, tells the Guardian that he’s opposed to AI on an ethical level because of how the datacenters used to power it are harming communities. He avoids using these tools, noting: “You’re not paying me to train your tools, so I’m not going to do it.”
But even those who would have otherwise been more open to AI are frustrated. The pressure to use AI “created more friction as it became obvious that we were being monitored for our usage, and we were being told that we had to use it”, even if it was the less efficient route to accomplish a task, according to Oliver, a recently laid-off worker. Oliver and other workers told the Guardian that Block’s AI tools can’t yet take the lead on some work in heavily regulated spaces, like banking and money transfers, which are vital parts of a financial tech company’s business.
Naoko Takeda, recently a data scientist at Cash App, which is owned by Block, wrote in a viral post on LinkedIn this week that she survived the layoffs but “felt immense dread and survivor’s guilt”. Despite a dramatic pay increase offered to employees who remained, she said, she left the company.
“In the last year, AI was shoved down everyone’s throats. Everything was about AI. We were told to use AI as much as possible,” she wrote. “It’s nothing short of dystopian to be forced to employ the very tools that accelerate the disappearance of the jobs on which our livelihoods depend. Personally, I saw very limited gains in productivity from AI, nothing nearly profound enough to justify tossing out half of the company’s workforce along with their institutional knowledge and expertise.”
Are bots bad for business?
Beyond the impact on employees, Block’s AI expansion may also hurt its business. George, who still works at the company, describes how some customers have become angry about Block outsourcing some initial requests for customer support to chatbots.
“We’ve noticed [from internal surveys] that [these bots have] made incredible mistakes,” he says. That includes telling customers to cancel or close their existing accounts as potential solutions. “That’s something, which, of course, we never want to encourage as a solution,” he says.
More broadly, workers described that, while AI can be especially helpful on the back end, customers and clients typically don’t like talking to automated bots when they have serious issues. “It’s frustrating, like, you can’t get your point across … it’s almost like it’s reading a manual to you, and it’s like, well, this isn’t the problem,” says Carl.
Other workers appreciate AI’s effect on productivity, but note its lack of judgment and emotional intelligence. “It doesn’t have discernment. It’s like, it can build a brick building, but does that mean it [understands] architecture?” says Oliver.
Amid these issues, the remaining workers are left to pick up the slack, as entire teams are decimated. Current employees describe being in “survival mode” and morale as “in the gutter”. An internal 26 February Slack message that the Guardian reviewed from Block’s engineering lead, in which he expressed gratitude to employees amid the layoffs, was met with a diverse array of emoji reactions from staff: hundreds of thumbs-downs, tomatoes, middle fingers and clown faces.
“Everyone that I know that’s still there has a ton of dread because they just realized their workload has quadrupled or 10xed and AI is not going to fix it,” Oliver says.
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