Sebastian Siemiatkowski, the CEO of Klarna, a leading “buy now, pay later” service, has ignited a debate with his bold statement that artificial intelligence (AI) is now capable of performing nearly all tasks typically handled by human workers. In an interview with Bloomberg TV, he explained how the rapid advancement of AI is transforming business operations and raising questions about the future of employment in an increasingly automated world.
Klarna has adopted an unconventional approach to reducing its workforce without resorting to layoffs. A year ago, the company stopped hiring new employees, which led to a gradual reduction in its team size. The employee count has decreased from 4,500 to 3,500, primarily due to a 20% annual attrition rate, common in the tech industry. Siemiatkowski clarified that instead of replacing departing employees, Klarna is utilizing AI and automation to fill the void.
“We experience natural attrition like any tech company. People stay for about five years, so 20% leave every year. By halting hiring, we’re simply shrinking,” he explained.
Despite the reduction in staff, Klarna is not cutting back on employee compensation. Siemiatkowski suggested that the savings from fewer employees could result in higher wages for those who remain. While Klarna’s website still lists some job openings, these are limited to essential roles, especially in engineering, highlighting a shift in hiring priorities within the tech sector.
Klarna is not alone in embracing automation. IBM’s CEO, Arvind Krishna, recently stated that AI could replace specific jobs within five years, particularly in departments like Human Resources. This trend reflects a broader shift, with companies across various industries exploring AI to optimize operations and restructure their workforce.
Tech giants such as Google, Amazon, and Meta have also made significant workforce reductions in recent years. While AI has not been explicitly cited as the cause of these cuts, the overall trend shows that AI is increasing the productivity of the remaining employees without the need for expanding the workforce.
