Block CEO Jack Dorsey’s move to cut nearly half the company’s workforce is shining a spotlight on a growing question for corporate America: whether advances in artificial intelligence will ultimately mean fewer workers.<\/p>\n
In an earnings call Thursday, Dorsey said Block will cut<\/a> about 4,000 jobs.<\/p>\n Dorsey framed the move as more than a cost-cutting exercise, instead describing a shift in how companies operate as artificial intelligence becomes more central to business decisions.<\/p>\n He also suggested other companies will follow suit.<\/p>\n “I don’t think we’re early to this realization. I think most companies are late,” he said. “Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes. I’d rather get there honestly and on our own terms than be forced into it reactively.”<\/p>\n Economists, however, question whether such moves signal a broader shift in the labor market or simply reflect company-specific adjustments.<\/p>\n “This is a function of lax judgment during a period of rapid expansion and the retrenchment that follows,” said Joseph Brusuelas, chief economist at RSM. “It should be understood within the unique context of that firm, and it does not signal risk to the broader U.S. labor market.”<\/p>\n Doubts about jobs<\/p>\n The layoffs come amid broader questions about the employment picture.<\/p>\n Though job cuts have remained low and the unemployment rate<\/a> is a relatively healthy 4.3%, openings have contracted sharply and hiring in 2025 largely flatlined, with average payroll growth of just 15,000.<\/p>\n Still, the tech-related picture looks relatively healthy.<\/p>\n The information sector, one proxy for the tech industry, saw its unemployment rate<\/a> fall to 5% in January, down 0.7 percentage point from a year ago. Job openings have declined in the sector, but demand for some roles remains firm: Postings in software development are up 12% from a year ago, according to Indeed<\/a>.<\/p>\n Most economists remain sanguine on the labor market, even in the current “low-hire, low-fire” environment. <\/p>\n Claudia Sahm, chief economist at New Century Advisors, said Friday on CNBC that while it is “healthy” to discuss AI’s potential impact, it is important not to overinterpret individual company decisions.<\/p>\n “I would not extrapolate from Block to the whole U.S. economy,” Sahm said. “It’s important to understand that these AI tools \u2014 the direction you go with them really depends on the leadership. Automation, mass layoffs is not necessarily the only path forward.”<\/p>\n AI’s broad impact<\/p>\n