As tech companies pour billions into artificial intelligence and slash workforces, middle managers are squarely in the crosshairs. A trend is emerging: when tech CEOs announce that AI enables doing more with fewer workers, they promise to flatten structures by cutting unnecessary management layers and bureaucracy. Just last week, cryptocurrency exchange Coinbase laid off 14% of its workforce while gesturing to AI-fueled, minimal-management efficiency. It joined Amazon, Block, and Meta in laying off tens of thousands with a focus on removing management layers.
Pressure on Middle Managers Intensifies
The push to thin management ranks is gaining traction, especially among companies rapidly adopting AI, said Anastassia Fedyk, assistant professor at UC Berkeley’s Haas School of Business. She has studied how AI changes workforce composition. As AI tools shift work from managers to reports, structural changes could become permanent, she said. These shifts are fundamentally reshaping middle management roles, often requiring managers to be both supervisors and producers, vastly expanding responsibilities. While moves aim to accelerate decision-making, they also could complicate jobs, create bottlenecks, reduce human interaction benefits, and degrade products and services.
“The middle manager role is about to be under a lot more pressure,” said Emily Rose McRae, analyst at Gartner. “What that means for employees is your job gets harder, too. When your manager doesn’t get support, you don’t get support.”
The trend isn’t confined to tech: by end of 2025, US middle manager job openings fell 42% from a 2022 peak, according to Revelio Labs. Managers comprised 13% of the US workforce in 2022.
Meta’s Experiment: AI Agents Replace Human Interaction
At Meta, managers felt pressure even before Mark Zuckerberg discussed flattening management in a January 2026 earnings call, said Prateek Singh, a former software development manager. After Singh joined in June 2025, managers saw direct reports jump and were expected to contribute code. Previously, managers focused on delegating and guiding. To handle added responsibilities, managers turned to AI tools for drafting documents, consolidating notes, and evaluating employees. They also used AI to generate code.
Singh switched one-on-one meetings from weekly to biweekly, communicating asynchronously using AI agents that connected with direct reports’ agents to collect updates and provide feedback. While the strategy worked for his team, he saw risks. “If managers are expected to write more code or have more reports, what I see happening is more asynchronous, agent-driven management,” he said. “Then people lose touch with benefits from face time,” like mentorship and human judgment. This is magnified at competitive employers like Meta, where top performer battles feel like The Hunger Games. AI can’t improve performance the way humans can.
Though he hadn’t witnessed it, Singh could see a future where pressured managers use AI for decisions and blindly submit flawed suggestions, leading to data leaks, security holes, or system outages.
Block’s 175 Direct Reports: A Radical Restructuring
After Block laid off 40% of workers, some engineering managers were assigned up to 175 direct reports under a new AI-oriented structure, according to internal charts reviewed by the Guardian. This moves toward CEO Jack Dorsey’s goal of all 6,000 employees reporting directly to him, minus management layers. Previously, managers had six to 12 direct reports, said Freeland Abbott, a former technical lead at Square who was laid off in February.
While Block’s structure aids information management, Abbott worries human parts of managers’ jobs could slip. AI can’t provide team motivation, human connection, or support as a person can. Off-loading employee development to same-level colleagues could disadvantage less-experienced and marginalized teams. Several former employees said, “Wow, thank God I was laid off.”
Abbott doesn’t expect those ratios to last, saying companies will recognize the need for more humans even if the role isn’t called “manager.”
Industry-Wide Shift: Amazon, Meta, Coinbase Lead
Meta and Amazon were among first to suggest flattening for AI. In 2023, Zuckerberg announced a “year of efficiency.” Two years ago, Amazon CEO Andy Jassy planned to increase employee-to-manager ratio by at least 15%, a goal reached last year. By 2026, both CEOs believe AI changes work: Jassy said Amazon “will need fewer people” for some jobs; Zuckerberg said Meta sees projects requiring big teams now accomplished by one talented person. Block and Coinbase followed this year.
Block splits management duties: AI shares information; “directly responsible individuals” oversee strategy; “player-coaches” manage employee growth. “There is no need for a permanent middle management layer,” read a statement from Dorsey and board member Roelof Botha. Coinbase will no longer have “pure managers”; managers must directly contribute code and have 15+ direct reports. CEO Brian Armstrong tweeted: “We’re fundamentally changing how we operate: rebuilding Coinbase as an intelligence, with humans around the edge aligning it.” Coinbase, Amazon, Meta, and Block declined to comment.
Consequences for Employees and Companies
Companies reducing middle management are likely agile tech firms, not legacy ones, said Raffaella Sadun, Harvard professor. They’ll feel friction, especially with sudden change. “They’ll have to incur the cost of change,” like overhauling coordination, decision-making, and shifting workers, including demotions.
Reducing managers complicates an already stressful job, said McRae. Many managers would choose not to be managers again. Fewer layers mean fewer advancement opportunities, risking loss of talent. Simplifying structure requires redesigning work, giving lower levels more authority, said Amalia Goodwin of Slalom. Employees need resources, skills, and training to judge outcomes. As output increases, work could slow if approval teams are overwhelmed.
Some experts are skeptical. Matthew Bidwell of Wharton noted companies have tried breaking hierarchies before, but efforts often fail. Middle managers are in a “precarious” position because “it’s harder to define your value.” Losing a layer of scrutiny means “you’ll move faster, but you’ll break more things.”
Singh left Meta, feeling his job at risk. Now employed outside Silicon Valley, he watches from a distance. “It’s just too early in the experiment. I didn’t want to be the guinea pig.”
