Block's CTO reveals a counterintuitive lesson: reorganizing from a GM-based structure to a functional one (where all engineers report to one org) was the key to their AI transformation. This structural change had a greater productivity impact than any specific AI tool they implemented.

Current layoffs are driven less by AI-driven automation and more by financial strategy. Companies are cutting labor costs to free up budget for necessary AI investments and to project an image of being technologically advanced to investors.

Recent tech layoffs, widely attributed to AI, are more likely driven by rising interest rates and a cultural shift for leaner operations. CEOs may be using AI efficiency as a convenient public justification for these cuts, even if the technology hasn't caused widespread displacement yet.

Despite public messaging about culture or bureaucracy, internal memos and private conversations with leaders reveal that generative AI's productivity gains are the primary driver behind major tech layoffs, such as those at Amazon.

Companies are framing necessary cost-cutting (driven by high interest rates) as strategic layoffs due to AI-driven efficiency gains. This allows CEOs to maintain a positive, innovation-focused narrative while tightening their belts for reasons they'd rather not publicize.

The conversation around AI and job reduction has moved from hypothetical to operational. Leaders are being instructed by boards and investors to prepare for 10-20% workforce cuts, ready to be executed. This isn't a future possibility; it's an active, ongoing preparation phase within many large companies.

Jack Dorsey framed Block's massive 40% layoff not as a response to business trouble, but as a proactive adaptation to AI-driven efficiencies. He chose one decisive cut over repeated, gradual reductions, arguing the latter is more destructive to morale, trust, and focus during a technological transition.

Businesses are increasingly framing necessary, performance-driven layoffs as a proactive AI strategy. This shifts the narrative from business struggles to forward-looking innovation, which is a better look for investors and the public.

Large-scale layoffs at growing companies like Amazon signal a new era of "corporate anorexia." AI and automation are allowing corporations to double revenue without increasing headcount. This drives enormous productivity and stock gains but signals a future of flattening white-collar employment, even in a strong economy.