Artificial Intelligence turns jobs into 'gigs' – the risk for workers

In 2024, the "buy now, pay later" company Klarna announced significant layoffs in customer service, intending to replace human agents with AI chatbots to save millions. However, a year later, customer complaints about declining service quality prompted Klarna to quietly begin rehiring human customer service staff, according to The Guardian.

This change initially seemed like a victory for workers in the age of AI. Yet, the reality is more complex. Instead of full-time positions, Klarna is now hiring customer service agents through an external agency, operating under what Klarna CEO Sebastian Siemiatkowski described as an "Uber-like model." While AI chatbots handle most basic inquiries, a growing number of gig workers are brought in for more complex issues.

Siemiatkowski explained in a February podcast that individuals can "join and work in Klarna's customer service" much like they might "drive for Uber for a while." This approach offers a glimpse into how AI is poised to reshape work. Labor economists are divided on whether AI will eliminate jobs entirely, but many agree it will automate parts of most jobs.

The optimistic view suggests AI will handle simpler tasks, freeing up employees for higher-level work. However, as companies increasingly integrate AI, they may hire fewer full-time employees, shifting towards a fragmented workforce resembling the gig economy. This model, characterized by flexible, short-term, or on-demand work, offers some autonomy but often lacks the benefits and security of traditional full-time employment, such as paid leave and health insurance.

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Just like someone can drive for Uber for a while, they can actually join and work in Klarna’s customer service.