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India Today
2 days ago
- Business
- India Today
Klarna CEO says AI could cause a white-collar job crisis and recession
When Klarna announced in 2024 that its AI assistant could handle the work of 700 customer service agents, it made headlines as one of the earliest real-world examples of large-scale job automation. Now, a year later, Klarna CEO Sebastian Siemiatkowski is raising the alarm himself: artificial intelligence might not just be replacing roles, it could be putting the global economy at risk. Speaking on The Times Tech podcast, Siemiatkowski said, "There will be an implication for white-collar jobs," warning that such a shift "usually leads to at least a recession in the short term." Siemiatkowski added: "Unfortunately, I don't see how we could avoid that, with what's happening from a technology perspective."advertisementKlarna, best known for its "buy now, pay later" services, has been at the forefront of AI adoption. The company partnered early with OpenAI to roll out an assistant that has now handled over 2.3 million customer queries. The automation helped the company reduce its headcount from 5,500 to 3,000 employees over the last two years. While the move boosted Klarna's revenue per employee and lowered costs, it also highlighted a difficult truth: AI doesn't just improve efficiency; it removes the need for humans in many has been among the few tech leaders willing to speak openly about AI's potential to eliminate jobs. "I want to be honest, I want to be fair, and I want to tell what I see so that society can start taking preparations," he But in a candid speech at Klarna's headquarters in May, the CEO admitted the company may have overcorrected. "From a brand perspective, a company perspective, I just think it's so critical that you are clear to your customer that there will always be a human if you want," he said. And so, last month, Klarna decided to shift back a little. The company started recruiting human agents again, testing a flexible, remote support model where agents can log in as needed – much like ride-share drivers do."Two things can be true at the same time," Siemiatkowski told a London SXSW audience last week. He believes AI is still crucial for handling repetitive or "boring" tasks, but human interaction remains essential for empathy and nuanced balancing act reflects a wider industry trend. Tech leaders like Google's Sundar Pichai and Microsoft's Satya Nadella have all noted that AI now writes around 30 per cent of their companies' code – and in the case of Meta CEO Mark Zuckerberg, the company may soon (in about 18 months) start to use AI to write 100 per cent of code. Zuckerberg has also said that AI is already equal to a mid-level engineer and could soon outperform even top coders. OpenAI's Sam Altman recently claimed that AI generates 50 per cent of the code at some firms, and Anthropic CEO Dario Amodei predicted that by the end of this year, all code will likely be companies like Duolingo and Shopify are laying off human staff and replacing them with AI. Shopify now requires managers to prove that a task can't be done by AI before hiring a not all industry voices believe the outcome has to be dire. Demis Hassabis, CEO of Google DeepMind, advised teenagers to embrace AI as the defining tech of their generation. At Google I/O, he said the industry could create "more valuable, usually more interesting jobs," even if old ones disappear. He emphasised skills like adaptability and creativity as essential for future-proof Siemiatkowski, the short-term outlook remains grim. He believes CEOs have been downplaying the economic risk posed by AI. "I don't want to be one of them," he said.
Business Insider
3 days ago
- Business
- Business Insider
Klarna CEO warns AI may cause a recession as the technology comes for white-collar jobs
Speaking on The Times Tech podcast, Sebastian Siemiatkowski said there would be "an implication for white-collar jobs," which he said "usually leads to at least a recession in the short term." "Unfortunately, I don't see how we could avoid that, with what's happening from a technology perspective," he continued. Siemiatkowski, who has long been candid about his belief that AI will come for human jobs, added that AI had played a key role in "efficiency gains" at Klarna and that the firm's workforce had shrunk from about 5,500 to 3,000 people in the last two years as a result. It's not the first time the exec and Klarna have made headlines along these lines. In February 2024, Klarna boasted that its OpenAI-powered AI assistant was doing the work of 700 full-time customer service agents. The company, most famous for its "buy now, pay later" service, was one of the first firms to partner with Sam Altman's company. Later that year, Siemiatkowski told Bloomberg TV that he believed AI was already capable of doing "all of the jobs" that humans do and that Klarna had enacted a hiring freeze since 2023 as it looked to slim down and focus on adopting the technology. However, Siemiatkowski has since dialed back his all-in stance on AI, telling an audience at the firm's Stockholm headquarters in May that his AI-driven customer service cost-cutting efforts had gone too far and that Klarna was planning to now recruit, according to Bloomberg. "From a brand perspective, a company perspective, I just think it's so critical that you are clear to your customer that there will be always a human if you want," he said. In the interview with The Times, Siemiatkowski said he felt that many people in the tech industry, particularly CEOs, tended to "downplay the consequences of AI on jobs, white-collar jobs in particular." "I don't want to be one of them," he said. "I want to be honest, I want to be fair, and I want to tell what I see so that society can start taking preparations." Some of the top leaders in AI, however, have been ringing the alarm lately, too. Anthropic's leadership has been particularly outspoken about the threat AI poses to the human labor market. The company's CEO, Dario Amodei, recently said that AI may eliminate 50% of entry-level white-collar jobs within the next five years. "We, as the producers of this technology, have a duty and an obligation to be honest about what is coming," Amodei said. "I don't think this is on people's radar." Similarly, his colleague, Mike Krieger, Anthropic's chief product officer, said he is hesitant to hire entry-level software engineers over more experienced ones who can also leverage AI tools. The silver lining is that AI also brings the promise of better and more fulfilling work, Krieger said. Humans, he said, should focus on "coming up with the right ideas, doing the right user interaction design, figuring out how to delegate work correctly, and then figuring out how to review things at scale — and that's probably some combination of maybe a comeback of some static analysis or maybe AI-driven analysis tools of what was actually produced."
