AI-Driven Restructuring Sweeps Australian Tech Sector

"We're halving the human capacity, but we're significantly increasing the overall capacity through agentic AI."
— Zubin Appoo, CEO, WiseTech Global

The Australian technology sector is undergoing a significant restructuring, with multiple major companies announcing substantial workforce reductions. These decisions are frequently attributed to the integration of artificial intelligence (AI), though the precise relationship between AI and job displacement remains a subject of debate among executives, employees, unions, and analysts.

Major Workforce Reductions

Block

Block, the parent company of Square, Cash App, and Afterpay, announced a reduction of its global workforce of approximately 4,000 positions — nearly 40% of staff. CEO Jack Dorsey stated the company is becoming a "smaller, faster, intelligence-native company" and cited rapidly improving AI models as a primary driver for the reduction.

Nick Molnar, Afterpay co-founder and Block's global head of sales and marketing, stated the decision reflects a genuine technological shift driven by AI. Following the announcement, Block's stock increased by up to 24%.

Atlassian

Atlassian announced a 10% global workforce reduction affecting approximately 1,600 positions, including 480 roles in Australia. CEO Mike Cannon-Brookes stated that AI has altered "the mix of skills and the number of roles required in certain areas" and that funds from these reductions will support investments in AI and enterprise sales.

The company anticipates pre-tax charges between US$225 million and US$236 million related to layoffs and office space reductions. Affected employees are expected to receive a minimum separation package of 16 weeks' pay, extended healthcare, and other benefits.

WiseTech Global

WiseTech Global announced a reduction of approximately 2,000 positions — nearly one-third of its workforce — across product development and customer service in 40 countries. CEO Zubin Appoo cited advancements in AI models as a contributing factor. The company subsequently reported threats of violence against Appoo after the announcement. The company's shares increased by nearly 11%.

Commonwealth Bank of Australia (CBA)

CBA confirmed 300 job reductions. Simultaneously, the bank launched a $90 million "Future Workforce Program" designed to retrain staff for roles in financial crime, digital risk, and data engineering. CEO Matt Comyn stated the bank aims to "replace uncertainty around AI with transparency and opportunity."

Telstra

Telstra announced plans for an AI-focused restructuring, including cutting up to 650 roles and offshoring hundreds of positions to India. The company projected a smaller workforce by 2030 due to automation. The Communications Workers Union raised concerns about the potential impact on local skills and data security.

Additional Companies

• Amazon announced 16,000 corporate cuts attributed to AI and automation
• Dow Chemical announced 4,500 role reductions
• Autodesk announced 1,000 job cuts
• HP announced up to 6,000 positions to be cut by 2028

Executive and Corporate Perspectives

AI Justification and "AI-Washing"

The justification of job cuts by citing AI efficiencies has drawn skepticism from various sources. OpenAI CEO Sam Altman has used the term "AI-washed" to describe companies that attribute layoffs to AI rather than previous over-hiring. A former Block employee described the announcement as "a workforce correction wearing an AI costume."

"The AI piece is real. What these tools can do now is fundamentally different to where they were even a year ago."
— Nick Molnar, Block

Block's Molnar affirmed the significance of AI, indicating the decision to reduce staff was made from a "position of strength" and reflected a structural transformation.

WiseTech's Appoo noted an internal communication to China-based employees that omitted the word "AI." A company spokesperson stated that internal communication language varies due to different legal and regulatory requirements.

Atlassian's Cannon-Brookes stated the approach is not "AI replaces people" but recognizes changes in skill needs. He also cited the need to adapt products to AI to counter competition, a factor influenced by the company's stock price decline over the past year.

Financial Technology Partners senior analyst Zachary Gunn commented that Block's job cuts appeared more related to the business being overstaffed than solely about AI integration.

Divergent Industry Predictions

Sam Altman stated, "I don't think we're going to have the kind of jobs apocalypse that some of the companies in our space advocate." He acknowledged that past predictions about entry-level white-collar job losses may have been wrong and emphasized the uncertainty of future job impacts.

Anthropic CEO Dario Amodei suggested AI could eliminate half of all entry-level white-collar jobs within five years, potentially raising unemployment to 20%. He warned that AI is likely to act as a "general labour substitute."

Westpac chief economist Luci Ellis indicated that concerns about mass unemployment might be overstated. She noted that clerical and administrative work are more susceptible to AI automation than caring occupations or trades.

Australian job search group Seek reported no current data indicating a specific decline in roles or industries as a direct result of AI.

Employee and Union Perspectives

Worker Experiences

Natalie MacDonald, whose role at LinkedIn was eliminated seven weeks after returning from parental leave, described her position being eliminated due to a restructure driven by AI investment. She has since launched a consultancy to assist professionals, particularly mothers and caregivers, in navigating career disruption.

A Block employee affected by cuts described the emotional impact of receiving notification shortly after dropping off their children. Conversely, an employee who retained their position reported a "palpable sense of excitement" among remaining staff.

Thomas Burt, a Sydney-based voiceover actor, reported losing a contract after his voice was cloned by AI. He stated that AI has reduced his work by 90% and prompted a career change.

Union Responses

The Financial Services Union described Bendigo Bank's AI adoption plan as a "dramatic and dangerous escalation in the fight to protect Australian jobs from being wiped out by AI."

Australian Council of Trade Unions national secretary Sally McManus stated that the union would increase pressure on employers to fulfill their legal obligation to consult workers on AI implementation.

Professionals Australia director Paul Inglis reported that union membership at WiseTech has surged to over 30% of the technical workforce in eight weeks, stating, "Workers are terrified of AI disruption."

Industry Support Networks

Senior technology leaders, many of whom are Block alumni, mobilized networks on platforms including LinkedIn and private Slack channels (e.g., "Square Mafia," which has nearly 3,800 members) to assist displaced colleagues by collecting details, referring them to open roles, and providing practical advice on severance and benefits.

Economic Data and Survey Findings

A Randstad Workmonitor survey indicated that one in three Australian workers believes their job will be affected by AI within five years, and a similar proportion report worsened job prospects. Less than half of Australian workers stated they had received training on AI tools.

UNSW Professor Toby Walsh warned that Australia is largely unprepared for an AI-driven future, citing a global survey showing significant declines in job postings for:

• Graphic designers: 33% decline
• Photographers: 28% decline
• Writers/copy editors: 28% decline

A research note from Citrini Research, acknowledged as speculative, highlighted a scenario of AI agents impacting software companies and potentially leading to mass white-collar unemployment. This report reportedly contributed to a temporary drop in the S&P 500.

"Business leaders initially see AI as a means for productivity and cost reduction, but in the medium term it could foster new business opportunities and facilitate staff redeployment."
— Dominic Price, work futurist

Michael Wright of the Electrical Trades Union argued that the physical infrastructure required for AI — including data centers, energy systems, and fiber networks — could generate substantial demand for skilled Australian workers.

BlackRock announced a $100 million investment to address professional shortages in infrastructure sectors in the US, targeting roles such as electricians, plumbers, ironworkers, and HVAC technicians.

Regulatory and Contractual Context

Currently, Australia does not have a comprehensive national law governing AI in the workplace. However, existing awards or enterprise agreements typically require consultation with employees when major changes, such as new technology introductions, are likely to have a significant impact.

New Product Launches

Block is preparing for the Australian launch of Square AI, a conversational AI assistant integrated into the Square platform. Research commissioned by Square indicated that while 64% of Australian business owners utilize AI in some capacity, fewer than half do so regularly. Business owners reported spending an average of 3.34 hours per week on data analysis.

Bendigo Bank AI Implementation

Bendigo Bank's board initiated a plan to utilize AI tools for efficiency improvements. The bank projects approximately $70 million in cost savings, which could correspond to a reduction of approximately 10% of its workforce, based on staff cost percentages. The bank partnered with IT providers Infosys and Genpact to streamline its operating model, following a previous agreement with Google. Bendigo Bank shares rose by approximately 10% following strong quarterly results, including a 7.6% cash profit growth and improved lending.