In a recent interview with Bloomberg TV, Klarna CEO Sebastian Siemiatkowski revealed a significant shift in the company's hiring strategy. A year ago, the company essentially put a halt to new hires and attributed this massive workforce reduction to the power of generative AI. As he stated, "We stopped hiring about a year ago. We were 4,500, now we’re 3,500." This natural attrition, with people staying about 5 years and 20% leaving each year, led to a shrinking of the workforce without the need for continuous recruitment.
CEO's Belief in AI's Replacement Power
Siemiatkowski firmly believes that AI can already take on the jobs that humans do. He mentioned, "I am of the opinion that AI can already do all of the jobs that we as humans do. We’re gonna give some of the improvements [from] the efficiency that AI provides by increasing the pace at which the salaries of our employees increases." This perspective has led to various experiments and changes within the company.For instance, to start 2024, the Klarna CEO said ChatGPT was doing the work of 700 human employees. At another point, Klarna dropped Salesforce as a CRM provider and replaced it with AI, a decision that sparked some skepticism among others. Just this week, Siemiatkowski even made an AI deepfake of himself to report the financial results, emphasizing the potential of AI to replace even the top leadership.Current Hiring Situation
Despite the significant reduction in the workforce over the last year, Klarna is not completely done with hiring. According to the job postings page on its website, the company is currently hiring for more than 50 roles around the globe. Moreover, Klarna's managers have stated multiple times on LinkedIn that they are actively hiring or growing their teams. In the last year alone, the company hired several new employees to fill crucial roles in its policy, software engineering, and global partnerships teams.John Craske, Klarna's global press lead, explains that Siemiatkowski's comments about hiring are directionally true but were simplified for brevity in the broadcast interview. He said, "When you look at it historically, we were hiring between one to one and a half thousand people a year from 2019 to 2022. Now, we’re not actively recruiting to expand the workforce but only backfilling some essential roles, predominantly engineering."AI's Impact vs. Workforce Stability
While AI is helping Klarna do more work with fewer people, it's important to note that the company has the same number of employees today as it did in 2021. During the pandemic, many tech companies, including Klarna, were on a hiring spree. But in recent years, like Meta and Amazon, many have reduced their workforces by either slowing down hiring or having layoffs.Klarna's case shows that while AI may be a powerful tool, not every job can be replaced by it immediately. The company is looking to IPO soon, and Siemiatkowski might be trying to convince investors that the company is aggressively incorporating generative AI into its workflows and that the benefits are already visible. For most companies these days, the adoption and implementation of AI are happening at a much slower rate, and Klarna is no exception.
