Current and former Block employees assert that AI cannot replace their roles following Jack Dorsey’s extensive layoffs: ‘AI just can’t handle that’

Mark had his first moment of doubt about his job security during an extravagant anniversary party at his fintech company, Block. The event took place last September, and while the executives showcased the productivity enhancements promised by a new internal AI tool, Mark, who worked in the product department, confided his concerns to colleagues. He expressed that although the future was uncertain, the technology was not yet advanced enough to replace the strategic vision and direction that workers like him provided. At that moment, he felt reassured that his role remained indispensable.

“You can’t really AI that,” he shared with the Guardian, emphasizing that “an employee is more than a series of tasks.”

Fast forward to last week; Mark was among around 4,000 employees laid off as part of a dramatic reduction in the workforce mandated by CEO Jack Dorsey. He cited improvements in AI productivity as the primary reason behind slashing the number of employees to almost half. In his communication to shareholders, Dorsey affirmed that with a smaller team utilizing advanced tools, the company could achieve greater outcomes.

However, in multiple interviews with the Guardian, seven current and former employees challenged Dorsey’s claims regarding AI tools being capable of replacing human workers on such a large scale. These employees, who asked to remain anonymous for fear of repercussions, worked across different departments like engineering and product. While many acknowledged that these AI tools could assist in certain tasks, they believed that the job cuts were more about restoring investor confidence following a slump in Block’s stock after significant losses tied to the volatile cryptocurrency market.

One employee, George, asserted that the layoffs represented “posturing for the market”, suggesting that Dorsey aimed to shift the company’s narrative from crypto reliance to AI-focused growth to improve his standing among investors. Following the announcement, Block’s stock did respond positively, indicating a short-term victory in investor perception.

In a recent interview with Wired, Dorsey boasted about a significant change occurring in December, attributing it to new AI tools like Anthropic’s Opus 4.6 and OpenAI’s Codex 5.3. He rejected claims of over-hiring during the pandemic, insisting that Block remained competitive in terms of gross profit per employee. He proposed that the traditional management structures were hindering productivity, aiming for the company to function like a “mini AGI.” Block did not provide any statements to the Guardian for further context.

These job cuts at Block reflect a broader trend of rising concerns around the role of AI in workforce reductions across the United States. Goldman Sachs pointed out that rapid AI adoption could increase unemployment rates this year, estimating that AI already contributed to 5,000 to 10,000 monthly net job losses in the previous year.

Creating Their Own Replacements

Initially, Block encouraged its employees to adopt AI technologies. However, over the past nine months, that encouragement evolved into a mandate. In a recorded internal meeting from January, Dorsey insisted that the traditional methods of operation were no longer effective.

“We have to shift. There’s no question,” he asserted.

Some workers, including Mark, felt they were being asked to develop and train tools that were intended to replace them. Mark expressed his disbelief: “It seemed like a thinly-veiled attempt to get input from employees on what tasks to automate. You basically have employees teach you how to automate them out. But these tools are not capable of encompassing everything in someone’s job.” Another former employee echoed his skepticism in an interview with Business Insider.

Even those whose roles centered around AI questioned the ability of these technologies to replace human effort comprehensively. John, an existing employee, pointed out, “We’re just not there yet. There’s a distinction between what’s technically possible and corporate rhetoric based on interpretations of AI capabilities.”

While the introduction of AI tools has accelerated engineering processes, humans remain a crucial part of the decision-making and quality control aspects. In a recent earnings call, Block’s leadership noted how workloads that previously required weeks could now be accomplished in significantly less time. They claimed a “greater than 40% increase in production code shipped per engineer since September.”

However, John countered that human oversight remains critical, highlighting that approximately 95% of code generated by AI still requires adjustments to meet Block’s standards. “They are not up to company standard on the first attempt,” he commented.

Moreover, Block has been closely monitoring employees’ usage of AI, with performance reviews now considering individual proficiency in using AI tools. Liam, a recently laid-off software engineer, recounted being pressed by management about his AI usage, making it clear that non-compliance could threaten his job security.

This intense drive for transformation has led to widespread ‘AI fatigue’; many employees feel overwhelmed by the pressure of constant adaptation to AI tools. John noted that “People are fed up with AI.”

Carl, another current employee, voiced ethical concerns about AI, particularly its environmental impact through large datacenters. He resolutely refused to train such tools, asserting, “You’re not paying me to train your tools, and I won’t do it.”

Amidst this shift, even supportive employees have expressed frustration. Oliver, a recently laid-off worker, remarked that the increasing scrutiny over AI usage detracted from efficiency, with mandatory usage leading to friction, especially when regulated fields like finance resisted such adoption.

Naoko Takeda, formerly a data scientist at Cash App, shared on LinkedIn that, despite surviving the layoffs, the environment felt oppressive. She mentioned, “In the past year, AI was shoved down everyone’s throats. It’s dystopian to be forced to employ tools that undermine our job security.”

Are Bots Bad for Business?

The rollout of AI at Block has broader implications for its business operations. George noted that numerous customers became frustrated when their initial support queries were routed to chatbots. “Internal surveys indicated that these bots often made serious errors,” he revealed, one including advising customers to close their existing accounts, a recommendation the company would never endorse.

While some employees appreciated the productivity benefits of AI, they also remarked on its limitations, particularly its lack of emotional intelligence and discernment. Oliver pointed out, “It can build a brick building, but it doesn’t understand architecture.”

As a result, remaining workers find themselves stretched thin, continually adapting to the fallout from mass layoffs within teams. Current employees describe a tense atmosphere, with morale sadly dwindling. An internal Slack message from February 26, expressing gratitude for hard work, was met with a cacophony of thumbs-downs, tomatoes, and other negative emojis from employees.

“I know many who are in dread mode,” Oliver states, “as they realize their workload has exploded, and AI won’t be the fix they hoped for.”