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Key Takeaways
- At a DC Fintech Week event last week, Federal Reserve Board Governor Christopher J. Waller suggested that AI is already reshaping the workforce, with some companies replacing customer support and IT roles through attrition.
- But the transition to AI doesn’t always work out. Klarna attempted to replace customer service agents with AI in 2023 but eventually backtracked, hiring humans.
- Still, Waller acknowledges that some job losses may occur due to AI. However, he remains optimistic about its long-term economic benefits.
While CEOs of major companies like Amazon (AMZN) have warned that artificial intelligence (AI) could result in job losses in the future, Federal Reserve Governor Christopher J. Waller recently suggested that outcome is already here. Some workers in customer support and administrative fields are being replaced by AI instead of by humans.
“Retailers in particular are cutting back on employment for call centers and IT-related occupations. So far, most say this is being handled through attrition, but a number of retailers say that there is the potential for downsizing next year,” Waller said on October 15 at DC Fintech Week.
Although AI has yet to have a widespread impact on the labor market, Waller indicated that companies have begun preparing for the potentially transformative effects of the new technology.
“AI is influencing recruiting for these firms, with some scaling back hiring because of AI and others adding workers who are proficient in its use,” Waller said.
Klarna, a buy-now-pay-later company, announced that it used AI to do the work of 700 customer service agents. However, CEO Sebastian Siemiatkowski reversed course, acknowledging that human customer support was still necessary.
“As cost unfortunately seems to have been a too predominant evaluation factor when organizing this, what you end up having is lower quality,” Siemiatkowski told Bloomberg in May 2025. “Really investing in the quality of the human support is the way of the future for us.”
Waller is optimistic about the potential of AI and its impact on the economy—even if it results in job loss for some workers.
Why This Is Important
If AI is able to yield substantial productivity gains, some believe it could result in greater economic growth but also cause widespread job loss, especially for college-educated workers.
“AI is moving faster than previous waves of innovation. … The challenge is to keep pace—to help workers and firms adjust so the gains in efficiency translate into higher real wages and sustained growth across the economy,” Waller said. “For policymakers, we must let the disruption occur and trust that the long-run benefits will exceed any short-run costs.”
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