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Late last month in Washington, D.C., Andrew Yang delivered a grim warning: “I have bad news, America. The Fuckening is here.”
Yang, a former presidential candidate, uses the term to describe AI’s potential devastation of the workforce. He predicts millions of knowledge workers could lose their jobs, personal-bankruptcy rates could spike, and downtowns could empty as offices hollow out. Onstage, he described computer-science graduates unable to find work, forced to drive for rideshare apps to survive. While his warnings are extreme, they tap into a growing anxiety: AI is advancing quickly, and new AI agents can do far more than traditional chatbots, assisting with complex tasks like building financial models or creating presentations.
The threat of widespread job loss seemed to materialize the day after Yang’s speech. Block, the payments company behind Square and Cash App, announced layoffs of roughly 4,000 employees—nearly half its workforce—citing AI as a factor. CEO Jack Dorsey, who co-founded Twitter, explained that AI tools, combined with leaner teams, were reshaping the way the company operates.
Block’s cuts were unusually large. The Wall Street Journal called it “the dreaded AI jobs wipeout.” Analysts suggest other firms might follow—not necessarily because AI can fully replace humans yet, but because layoffs tied to AI have become a fashionable signal.
Some observers are skeptical. Block may have used AI as a convenient justification—a case of “AI-washing.” The company expanded rapidly during the pandemic, tripling its workforce between 2019 and 2022. A sudden 50% efficiency gain seems unlikely, said Ethan Mollick, a Wharton professor, suggesting Dorsey’s AI explanation should be taken with caution.
Two former Block employees affected by the layoffs confirmed that AI tools like Anthropic’s Claude Code and Block’s own Goose were changing workflows. Yet they noted that such tools are widespread in the tech industry; other companies use AI heavily without massive layoffs.
Dorsey told Wired the layoffs were proactive. Advances in coding bots from Anthropic and OpenAI had shifted what was possible, he said, giving Block a chance to restructure as an AI-native company. The stock price rose after the announcement, signaling investor approval for Dorsey’s vision. Experts warn, however, that premature AI-driven layoffs could backfire. Institutional knowledge needed to build effective AI tools may be lost, and remaining employees could feel overworked and demoralized.
AI’s current capabilities often fall short of fully replacing humans. Nobel laureate Simon Johnson notes that rushed automation with inferior machines harms both businesses and society. Yet in corporate America, labor is often seen as a cost to minimize rather than a resource to develop.
For decades, AI researchers have predicted the end of white-collar work. Now, as the technology arrives, the warnings are louder than ever. Mustafa Suleyman, Microsoft’s AI chief, predicts most white-collar jobs could be automated within 12 to 18 months, while Anthropic CEO Dario Amodei forecasts that half of entry-level workers may soon be jobless. Still, widespread layoffs remain more narrative than reality. Executives face pressure to demonstrate AI adoption, and layoffs are a visible, immediate way to signal progress—even if the technology isn’t yet ready to replace people entirely.