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Even though the workforce is downsized, Klarna’s management has vowed that employees’ wages will not be affected.
Advances in AI will mean that millions of workers will need to switch jobs by 2030. (Representative image)
Klarna, a prominent name in the “buy now, pay later” (BNPL) fintech space, has substantially altered its staffing strategy largely due to developments in artificial intelligence (AI). Klarna CEO Sebastian Siemiatkowski, recently revealed the company has not hired any new staff in over a year and has instead let natural attrition shrink its headcount. This decision resulted in a 22 per cent reduction in the workforce, reducing the headcount from 4,500 to 3,500 employees.
The reason for this hiring freeze, he told Bloomberg, has to do with the ability of AI to complete work previously done by humans. About 200 employees are currently using AI in their primary jobs, he said. He added that Klarna is using AI not just to improve efficiency but also to raise salaries for remaining workers as the cost of salaries falls overall.
“We stopped hiring about a year ago… By not hiring, we’re simply shrinking,” Siemiatkowski said in an interview on Bloomberg TV.
A spokesperson for the company told ITPro, “This decision is influenced by the efficiencies gained through AI, which allows us to operate with fewer resources while maintaining high service standards. AI has enabled us to streamline operations.”
AI has already been adopted internally; earlier this year, Siemiatkowski said an AI assistant was introduced. So far, it has handled over 2.3 million customer interactions, essentially taking the work of nearly 700 full-time customer service agents, reports ITPro.
Even though the workforce is downsized, Klarna’s management has vowed that employees’ wages will not be affected. Instead, it wants to share any efficiency gains from AI with its employees. “What’s going to happen is the total salary cost of Klarna is going to shrink, but part of the gain of that will be in your paycheck,” Siemiatkowski explained.
Leaders in the industry have not missed this strategy. As companies like Klarna move away from using platforms like Salesforce and Workday, Salesforce CEO Marc Benioff questioned how they’d be able to keep up on the data and compliance front without the traditional staffing levels organizations had in the past.
Advances in artificial intelligence will mean that millions of workers will need to switch jobs by 2030, according to a new report from McKinsey & Company.
