The AI Layoff Is Coming. Here's How to Prepare Before It Does.

In February 2026, Jack Dorsey cut nearly half of Block's workforce (4,000 people), and pinned it on artificial intelligence. "A significantly smaller team, using the tools we're building, can do more and do it better," he wrote to shareholders. Then came the part that should have made every working professional listen carefully:

"I think most companies are late. Within the next year, I believe the majority of companies will reach the same conclusion and make similar structural changes."

If you read that and felt your stomach drop, you're not alone. And you're not overreacting.

Whether or not AI is actually replacing your job, the narrative that it will is already shaping decisions about your future. That's the part worth paying attention to now, while you still have time to do something about it.

What's Actually Happening (and What Isn't)

Here's the tension: in 2025, companies attributed 55,000 job cuts directly to AI this is twelve times more than just two years earlier. That sounds terrifying until you learn it represents only 4.5% of total reported layoffs. The rest were chalked up to plain old "market and economic conditions."

Bloomberg raised similar questions about Block specifically, suggesting the cuts had less to do with AI capability and more to do with good old-fashioned headcount reduction wearing a shinier hat.

Does that mean you can relax? No. It means the situation is more complicated than "AI is coming for your job," and more complicated is harder to navigate. 

You're not just dealing with a technology shift. You're dealing with a story companies are telling about a technology shift, and that story is driving real decisions about real people's employment.

The feeling this produces (a low-grade dread that something is coming but you can't quite name it) is not paranoia. It's pattern recognition. Now you need to figure out what to do with it.

How to Read the Room

Most people wait for the official announcement. By then, the important decisions have already been made without them.

If you're trying to figure out whether your role is in the crosshairs, stop listening to what leadership says about AI and start watching what they do. Here are some signals worth tracking:

• Restructuring language in all-hands meetings. When you hear talk about "efficiency," "transformation," or "doing more with less," that's not a vision statement. That's a forecast.

• Your function showing up in AI vendor demos. If the company is piloting tools that automate pieces of what you do, take note. It doesn't mean you're getting replaced tomorrow. It means someone is building the business case.

• A hiring freeze paired with technology investment. Companies don't stop hiring because they have enough people. They stop hiring because they're betting on a different model. If your department isn't backfilling roles but the company just signed a seven-figure AI contract, do the math.

• Your manager suddenly can't answer questions about headcount. This one is subtler. When the people who usually have answers start hedging, it's because they've been told not to share what they know yet.

  
  

None of these signals alone means a layoff is imminent. But if you're seeing two or three of them at once, it's time to stop watching and start moving.

How to Prepare for AI Layoffs While You Still Have Leverage

The biggest advantage you have right now is time. Most people won't use it. They'll wait, hope it blows over, and scramble when it doesn't.

Treat the period before a layoff announcement as your most valuable negotiating window. Once the decision is made, your options shrink dramatically.

Here's where to focus:

• Document your impact for your files. Start keeping a record of your contributions: revenue generated, projects delivered, institutional knowledge only you hold, client relationships you manage. Quantify everything you can. This isn't busywork. If you end up negotiating severance, specifics are leverage. If you end up interviewing, specifics are your story.

• Read your employment agreement and employee handbook. Actually read it. Pull up your offer letter, any amendments, your equity agreements, your non-compete (if you have one). Look at the severance provisions. Look at the vesting schedule. Look at the clawback clauses. Most people have no idea what they signed, and that ignorance can costs you.

• Build a financial cushion, even a small one. This isn't about having a year of savings. Even one month of expenses set aside changes your psychology at the negotiating table. The difference between "I need to sign this today" and "I can take a week to review" can be the difference between a bad severance package and a significantly better one.

• Have the conversation you've been avoiding. Don't ask "Am I getting laid off?" That puts your manager on the defensive and gets you nothing useful. Instead: "How is the team evolving? Where do you see my role as the company invests more in AI?" You're gathering information, not asking for reassurance. Information is leverage. Reassurance is just noise.

• Start your external positioning now. Update your LinkedIn. Reconnect with your network. Have coffee with a recruiter. Take deliberate action. The best time to explore what's next is before you need to. The worst time is the Monday after you've been walked out.

  
  

What Most People Get Wrong

A few myths worth naming:

• "If I upskill in AI fast enough, I'll be safe." Maybe. But if the decision to cut your role is structural (meaning the company has decided it doesn't need that function performed by a human anymore) no amount of Claude or Chat GPT practice will change the outcome. Upskilling is smart. Upskilling as a shield against a decision that's already been made is magical thinking.

• "I'm a top performer, so I'm layoff-proof." Performance protects you from being fired. It does not protect you from being laid off. These are different processes driven by different logic. A layoff is a business decision about roles, not a performance decision about people, even when it doesn't feel that way.

• "I'll just wait and see what happens." This is the most expensive move on the board. Every week you wait is a week you're not documenting, not reading your agreements, not building your cushion, not positioning yourself externally. Waiting feels like the safe choice. It's actually the choice that gives away the most control.

  
  

The Dread Doesn't Disappear, But It Can Transform

That low-grade hum of anxiety you've been carrying? It's not going to go away because you read an article. But it does change shape when you have a plan. Dread without action is paralyzing. Dread with a strategy is just adrenaline pointed in the right direction. Take the time to prepare for AI layoffs now, before you're in crisis mode.

The companies making these decisions aren't waiting. They're not hoping it blows over. They're moving, sometimes thoughtfully, sometimes recklessly, sometimes using AI as a convenient excuse for cuts they wanted to make anyway. You get to decide whether you move too, or whether you let someone else write the story of your exit.

If you got the call tomorrow, would you know what you signed, what you're owed, and what you want? If not, today is a good day to start finding out.