He believes that the profound impact of AI on employment will lead to economic downturns as companies increasingly streamline their operations.

Klarna's AI assistant has notably replaced the work of 700 full-time customer service agents, contributing to a significant reduction in the company's workforce from 5,500 to 3,000 over the past two years.

Despite these workforce reductions, Siemiatkowski admitted that Klarna's reliance on AI had become excessive, prompting plans to hire more staff to ensure human customer interactions.

Mike Krieger, Chief Product Officer at Anthropic, expressed caution in hiring entry-level software engineers due to AI's impact, while also recognizing the potential for AI to create more fulfilling job opportunities.

This conversation reflects a broader industry debate on how to balance AI integration with job preservation as companies adapt to new technologies.

Interestingly, blue-collar jobs seem less affected by AI due to the ongoing necessity for manual labor across various sectors.

AI is already being leveraged in numerous industries, such as call centers, law, and accounting, to enhance efficiency and reduce operational costs.

Sebastian Siemiatkowski, CEO of Klarna, has raised alarms about the potential for artificial intelligence (AI) to trigger a recession by displacing white-collar jobs.

Siemiatkowski specifically noted that the replacement of white-collar jobs by AI typically results in short-term recessions.

In the UK, the government has adopted AI tools like Humphrey to cut labor costs, previously spending £80 million annually on manual consultations.

Dario Amodei, CEO of Anthropic, echoed concerns about AI's impact on employment, predicting that it could eliminate 50% of entry-level white-collar jobs within five years.

Gita Gopinath from the IMF has warned that the widespread adoption of AI could worsen economic downturns by disrupting labor markets and financial systems.