Block’s CEO, Jack Dorsey, emphasises a fundamental shift in employment dynamics, highlighting that the calculus of workforce needs has irrevocably changed. (Photo: Alpha Perspective for Unsplash)
On Sunday, 22 February, a small macro analyst firm called Citrini Research published a thought experiment on Substack that briefly broke the internet — and, for a few days at least, rattled Wall Street. Titled The 2028 Global Intelligence Crisis, the piece was written as a faux-memo from two years into the future, authored by a fictional analyst surveying the wreckage of an AI-driven economic collapse.
It described tens of thousands of white-collar workers — product managers, software engineers, financial analysts — forced out of their careers and into the gig economy, flooding Uber driver queues with graduate degrees. And it detonated across finance Twitter, trading desks and blogs. Worse, it jangled nerves and pre-empted a US market slide hard in the wake of the piece, with the Dow down 821.9 points (1.7%) on the Monday after it circulated, and the sell-off concentrated in the kinds of companies Citrini name-checked as vulnerable to AI automation (Visa, Mastercard, DoorDash, Salesforce).
Let that settle.
In this strange new viral world, an entirely speculative essay can behave like a very poor earnings report if enough people forward it with urgent recommendations to read, replete with exclamation points.
The core of Citrini’s thesis was what its authors called the “intelligence displacement spiral”. Once AI replaces knowledge workers, companies earn more and spend less on wages. Displaced workers earn less and consume less. Consumption falls. Margin pressure builds on other firms, pushing them toward their own AI efficiency drives. The loop feeds itself.
“It was a negative feedback loop with no natural brake,” Citrini writes, in the voice of its imagined future analyst. “The system turned out to be one long daisy chain of correlated bets on white-collar productivity growth.”
Only two days later came the first rebuttal from the giant Citadel Securities, which published its own Global Intelligence Crisis note on Tuesday, 24 February (authored by strategist Frank Flight). One can imagine that the fundis at Citadel, a prestigious market maker, were aggravated at witnessing a huge equity sell-off driven by a speculative scenario from a tiny research company, and quickly sought to do some damage control.
The Citadel report reached for data rather than the more theatrical missive from the future. Job posting data showed demand for software engineers rising 11% year over year in early 2026, and the St Louis Fed’s analysis of the Real-Time Population Survey found daily use of generative AI for work “unexpectedly stable”, with “little evidence of any imminent displacement risk”.
New business formation, Citadel noted, was expanding rapidly; the construction of AI data centres was generating its own hiring boom. The doomsday scenario, Citadel argued, fundamentally ignored the physical constraints on AI “diffusion” (a fancy word for how it will seep into our lives).
Citadel cited energy costs, computing limits, and regulatory friction — factors that would naturally brake any runaway substitution of human labour. If the marginal cost of compute rises above the marginal cost of human labour for certain tasks, substitution will simply not occur, creating a natural economic boundary. And organisations are messy, AI integration is costly, and mass layoffs are not a good look for companies in the public eye.
That might have been the end of it — two short, sharp views of the future from organisations with entirely different lenses.
But a mere two days later, on Thursday, 26 February, in a startlingly coincidental accident of timing, Jack Dorsey, the highly respected original creator of Twitter (he is now long gone from there), announced that his fintech firm Block would cut more than 4,000 jobs — nearly half the workforce — explicitly tying the move to AI-driven operating changes.
What matters isn’t the exact number. It’s the phrasing. Dorsey didn’t hide behind “restructuring” or “macro headwinds”. He effectively said, the calculus of employment has changed; the maths no longer works.
In Reuters’ reporting, he argued that a “significantly smaller team” using these “intelligence tools” can “do more and do it better,” and that most companies are “late” to this realisation. AP similarly reported Dorsey’s thesis that intelligence tools had changed what it means to build and run a company, making smaller teams materially more effective.
A strong signal
But Dorsey's parting message — that he would rather act now than be forced to react later — will not be lost on his peers. When a company cuts half its workforce, posts record profits, and watches its stock jump 24% in a single session, it sends a signal that capital markets find it very difficult to ignore.
Block’s layoffs were not driven by a financial crisis. They were driven by a profitable company deciding that it no longer needed half its people. Gross profit up 24%, stock price up 24%, 4,000 people laid off — the savings redirected into AI tools. This was exactly the dynamic foreseen by Citrini.
The debate, then, is not really about whether Citrini's precise scenario unfolds on schedule. It is about whether the underlying mechanism — AI enabling firms to produce more with fewer people, in sectors where cognitive work is the core product — is real. On that question, the evidence is accumulating rather than retreating, notwithstanding Citadel’s pushback.
Amazon, Meta, Salesforce, and now Block have all cited AI as a material factor in large-scale workforce reductions. Pinterest, CrowdStrike and Chegg have also recently announced job cuts directly attributed to AI reshaping their workforces. But Dorsey was the most honest about why he killed 4,000 jobs.
Here is what he wrote to his employees on X:
“Something has changed. We’re already seeing that the intelligence tools we’re creating and using, paired with smaller and flatter teams, are enabling a new way of working which fundamentally changes what it means to build and run a company. and that’s accelerating rapidly.
“I had two options: cut gradually over months or years as this shift plays out, or be honest about where we are and act on it now. I chose the latter. Rpeated rounds of cuts are destructive to morale, to focus, and to the trust that customers and shareholders place in our ability to lead. I’d rather take a hard, clear action now and build from a position we believe in than manage a slow reduction of people toward the same outcome. a smaller company also gives us the space to grow our business the right way, on our own terms, instead of constantly reacting to market pressures.”
More mass layoffs like these are coming. Not all at once, not uniformly, and not on any analyst’s precise timetable. But the incentive structure is now visible, the template has been set, and the rationalisation — that smaller teams with better tools will outperform larger teams without them — has been validated in public, at scale, by one of the most prominent tech entrepreneurs of his generation.
The question is no longer whether AI will reshape the labour market. It is which industries will feel it first, how fast the contagion spreads, and whether governments will move quickly enough to cushion the landing for the people caught between the world that was and the one that is arriving.
The canary, as Citrini wrote, is still alive. But it is no longer singing. DM
Steven Boykey Sidley is a professor of practice at JBS, University of Johannesburg, a partner at Bridge Capital and a columnist-at-large at Daily Maverick. His new book, It’s Mine: How the Crypto Industry is Redefining Ownership, is published by Maverick451 in SA and Legend Times Group in the UK/EU, available now.