Last week, Block laid off more than 4,000 employees. That is roughly 40% of the company behind Square, Cash App, and Afterpay. Jack Dorsey said AI made them redundant, and predicted "the majority of companies" would reach the same conclusion within a year.
Block's share price jumped 24% in after-hours trading. Wall Street loved it. If you run a business in Malaysia or lead its tech team, pay attention. This kind of decision is coming your way sooner than most people expect.
What happened at Block
Block went from over 10,000 employees to under 6,000 in one announcement. Dorsey framed it as a permanent structural change: "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."
Other companies have blamed AI for layoffs before — Dropbox, Duolingo, a handful of media outlets. But nobody has been this blunt or gone this big.
Meanwhile, IBM is tripling junior hiring
Two weeks before Block's announcement, IBM said it would triple entry-level hiring in the US for 2026. Because of AI, not in spite of it.
IBM is redesigning junior roles instead of removing them. Junior developers now spend less time writing boilerplate and more time talking to customers. Entry-level HR staff step in when AI chatbots get it wrong. IBM's CHRO put it plainly: "The companies three to five years from now that are going to be the most successful are those companies that doubled down on entry-level hiring in this environment."
So which company has the right idea? Probably both. Block is a fintech platform where a lot of work is repetitive transaction processing. IBM is a consulting business where client relationships drive revenue. The point is not that one approach wins — it is that you need to pick your approach on purpose, not by accident.
Which roles are most at risk
The World Economic Forum projects 92 million jobs displaced and 170 million new roles created by 2030. The jobs most exposed tend to be repetitive, rule-based, and data-heavy:
- Data entry and admin clerks face up to 95% automation risk
- Gartner projects AI chatbots will handle up to 80% of routine customer service inquiries by 2029
- A Citigroup report found up to 54% of banking jobs have high automation potential
- Goldman Sachs estimates about 44% of legal tasks could be automated
If a job is mostly about processing information by following rules, AI can probably do it faster and cheaper. Jobs that need judgment or genuine human relationships are safer. For now.
What this means for Malaysian businesses
Malaysia is pushing hard on AI Nation 2030 — Budget 2026 put RM2 billion toward a Sovereign AI Cloud and RM53 million into the Malaysia Digital Acceleration Grant. The government wants businesses to adopt AI. But adopting AI without thinking about your workforce is how you end up scrambling.
Lower labour costs buy you time, but not forever. A customer service rep in Malaysia earns a fraction of what their counterpart makes in San Francisco, so the business case for AI replacement is weaker. That gap is closing as AI tools get cheaper.
The talent shortage is already a problem. Malaysia does not have enough skilled tech workers. Cutting junior roles Block-style would make that worse. For most Malaysian companies, IBM's approach of reshaping entry-level jobs around AI is the smarter move.
Government reskilling support is decent. MDEC's AI Skills Training programmes are claimable under HRD Corp's Skim Bantuan Latihan. Budget 2026 added a 50% tax deduction for MSMEs investing in AI and cybersecurity training.
Three things to do now
Audit your roles for AI exposure. Map every role on two axes: how repetitive the work is, and how much human judgment it requires. High repetition, low judgment — that is where automation hits first.
Redesign roles before you cut them. A data entry clerk could become a data quality analyst overseeing AI processing. A customer service agent could handle the escalations AI cannot. The role changes, the person stays.
Use your training subsidies. MDEC's AI Skills Training is HRD Corp-claimable. The 50% tax deduction on AI training for MSMEs is sitting there — most businesses are not claiming it. If your competitors are training their teams and you are not, you are falling behind on their dime.
Bottom line
Block's layoffs tell you something, but they do not tell you what to do. If you are running a services firm in KL or a manufacturing operation in Penang, your calculus is different. Your clients care about relationships. Your institutional knowledge lives in people.
Malaysia has reskilling money on the table, tax breaks that most businesses are ignoring, and enough lead time to act before things get urgent. That window will not stay open forever.
If you want a hand working out how AI fits your operations, get in touch. We build AI solutions and custom software for Malaysian businesses, and our focus is making your team better at what they do.
