Jack Dorsey has just reduced the size of the Block workforce – and he says your company is next

Jack Dorsey has been very happy with Elon Musk. Now, it seems he may have been taking notes.

Thursday, Dorsey he announced that Block, the payments company he founded that works for Square, Cash App, and Tidal, is cutting more than 4,000 employees, approx. half global workforce, taking them from more than 10,000 employees to less than 6,000. Investors responded enthusiastically, sending the stock up more than 24% in temporary sales.

This isn’t the first time a major tech company has done something like this. In November 2022, Musk cut nearly 50% of Twitter’s workforce in one fell swoop after taking the company private, a move that upset many in Silicon Valley and rewrote the unofficial rules for how a CEO can pass a single firing.

Dorsey was in an unusual position to watch it unfold. He raised his ownership of about 2.4% in Twitter to acquire Musk in lieu of cash, making him one of the largest foreign investors to become X.

The two men have had a strange professional relationship, with a warm voice that has shot up in public, and back again. Dorsey supported Musk’s discovery on Twitter, later saying Musk “should have left.” He helped launch Bluesky, a Twitter alternative, then left his team and called X “free technology.” Both are Bitcoin voice advocates – Block and Tesla each carry the cryptocurrency on their websites.

Dorsey framed the cuts Thursday as a way to encourage, even compassionate, choice, not a financial crisis. (The 4,000 people who have been laid off may see it differently.) “Repeated cuts destroy quality, focus, and the trust customers and shareholders place in our leadership skills,” he wrote on X. He predicted that within a year, most companies would be in the same place. “I’m better off getting there honestly and willingly rather than being forced into it,” he said.

Bars are being run, at least legally, by AI. Block CFO Amrita Ahuja said the cut would allow the company to “move faster with smaller, more skilled teams that use AI to do more work.”

Salesforce and Amazon are among the growing list of other companies that have done so big employees wounds touting the benefits they see from AI, even a Forrester Research report last month give some doubt about how real those benefits are compared to the likelihood that most of those out of a job are driven by money.