All applications do still work, it is just the shortcut in the application menu that broke.
I get the following error when I try to run qubes-desktop-run /ust/share/applications/firefox-esr.desktop
Traceback (most recent call last):
File "/usr/bin/qubes-desktop-run", line 3, in <module>
from qubes.xdg import launch
ImportError: No module named 'qubes'