You cannot attrite 40% of the company in 5 months, without creating an incredibly toxic environment. Dorsey knows this; ultimately he lost Twitter over his inability to right size it. I would bet dollars to donuts he promised himself he wouldn't do it again - under no circumstances is 40% cut over six months preferable to a clean fast cut.
What is the age distribution of employees at Block? I'd guess it skews quite young. You won't have much natural attrition or interest in early retirement. And in this job market, voluntary severance is also not very attractive.
Young people love to be paid to switch jobs too - who would refuse 20 weeks of doubled income? From Squares perspective, this would lead to an adverse selection, because Square would lose the people who can easily get jobs elsewhere.
That is working on the assumption that those employees are meaningfully better than the ones who remain. If you have people you feel are under performers then yes, ideally you would lose those specifically but then it’s not a reorganization it’s a performance based layoff where you’re outright saying “you’re not good at your job”
> That is working on the assumption that those employees are meaningfully better
The assumption that people who get hired after interviewing are "better" than those who are fall off the hiring funnel underpins the entire hiring process that even Square relies on. Does the assumption seem outlandish to you?
I think that assumption is not unreasonable - but I don’t think it’s a reasonable conclusion to say the people who are more confident to jump ship are inherently better for the future of a company than those who have been around for just as long and don’t want to risk it in the market.
Sure but 5 months isn't the comparison. They state that they're cutting early. We don't know the exact position, but perhaps over 2-3 years would be ok, and 40% in 3 years isn't unheard of, particularly in the valley, and particularly with incentives.
