Tech company behind Cash App, Square announces layoffs for 40% of its staff: 'Everyone is going to be doing this soon'

Experts have warned for years that the adoption of artificial intelligence would one day lead to massive job losses, reshaping not only the economy but also society at large. 

That day may now be here. 

In a troubling sign for the future of employment, Block, the company behind Cash App and Square, announced that it was laying off 4,000 workers, or about 40% of its workforce, according to an AP report. 

What's happening?

Citing productivity gains from AI tools, Jack Dorsey, the Block CEO, said the company can now get by with far fewer human workers. 

"The core thesis is simple," Dorsey said, per the AP. "Intelligence tools have changed what it means to build and run a company. A significantly smaller team, using the tools we're building, can do more and do it better."  

Investors appeared to welcome the move to lay off a large portion of the company's human staff, with the Block stock price leaping by more than 20% following the announcement, according to the AP. 

Why are AI-related job losses important?

Experts have long cautioned that, as AI tools grow more sophisticated, more and more human workers will find themselves automated out of a job. 

A team of researchers at Stanford University used statistical analysis to determine that AI-related job losses began affecting entry-level employment in AI-exposed fields as early as 2024. These job losses were particularly impacting young people, who rely on entry-level positions to get their initial foothold in the job market. 

So-called "AI-exposed" occupations have even included fields once thought "safe" in terms of future job prospects, such as software programming.

"I now believe that AI may have contributed a meaningful amount to the overall slowdown in hiring for entry-level workers," wrote Bharat Chandar, one of the Stanford researchers. 

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The Block layoffs could be a sign that AI-related job losses are now moving beyond entry-level positions, putting even experienced, higher-level workers at risk. 

Commenters on the internet were less than thrilled at the prospect.

"Everyone is going to be doing this soon," said one user on X. 

"Ok what happens to the market when half the people lose their job?" wrote another. "We saw how the market reacted short term but it appears to me long term this won't be good." 

In addition to the risks it poses to human employment, AI has also placed an enormous strain on the existing electrical grid. As the energy-hungry data centers that power AI models have proliferated across the United States and around the world, everyday consumers have seen their electricity prices skyrocket. 

What's being done about AI-related job losses?

Not everyone agrees that these job losses are solely due to the increased use of artificial intelligence. For example, Sam Altman of OpenAI has publicly accused companies of "AI washing," or blaming AI for unrelated job losses, according to Fortune. 

Regardless of the cause behind any single round of layoffs, experts still broadly agree that AI has the potential to reshape employment as we know it. To address the society-wide repercussions of massive job losses, governments and industries will have to work together to make sure that people are still able to afford basic necessities like food, shelter, and health care. 

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