Klarna, a Swedish payment service provider, has not hired any new employees for a year. Instead, it uses AI technology to perform the work that hundreds of employees used to do. CEO Sebastian Siemiatkowski explained this to the financial news agency Bloomberg. Over the same period, the company reduced its workforce by around 22%, now employing about 3,500 people. Approximately 200 of them use AI technology for their core tasks. The workforce was convinced by promising them a share of the gains made possible by AI as part of their salary.
Klarna has been making headlines for months with its decisive use of AI technology. In February, the company announced that AI was handling customer inquiries, performing the work of 700 full-time employees. In terms of customer satisfaction, the technology is on par with human employees. This report led to a drop in the stock price of Teleperformance, the world’s largest call center operator. The company’s share price fell significantly and has not recovered since. Klarna stated that the technology is expected to enable a revenue increase of 40 million US dollars.
Bloomberg also noted that during the recent presentation of Klarna’s financial figures, a CEO-generated AI copy represented Siemiatkowski. This, according to the CEO, proves that AI can ultimately take over all jobs. Internally, employees use as much AI technology as possible because they see part of the gains reflected in their paychecks. Klarna’s next major goal is to target the US market, where it plans to establish a bank. The company has also taken initial steps for a public offering in the US.
In related news, there have been reports of job losses due to AI. For instance, in May alone, 3,900 positions were eliminated in the US because of AI advancements. There are also proposals from the United Nations suggesting that work done by AI should be taxed higher.
The shift towards AI in companies like Klarna is a part of a broader trend where businesses are increasingly relying on technology to enhance efficiency and cut costs. However, this trend also raises concerns about job security and the future of work as AI continues to evolve and become more capable.
As AI technology continues to advance, it is expected that more companies will follow Klarna’s lead in integrating AI into their operations. This could lead to increased productivity and profitability but also poses challenges in terms of workforce displacement and the need for new skills.
While AI offers significant benefits, it is crucial for companies to carefully manage the transition to ensure that employees are supported and retrained for new roles. This approach can help balance the advantages of AI with the potential social and economic impacts of job displacement.
Overall, Klarna’s experience with AI highlights both the opportunities and challenges of integrating advanced technology into business operations. As more companies explore the potential of AI, it will be important to consider the broader implications for society and the economy.