Klarna Rehires Workers It Said AI Would Replace, CEO Admits Limits of Automation

Swedish buy-now-pay-later company Klarna is rebuilding its human customer-service team less than two years after CEO Sebastian Siemiatkowski claimed an AI assistant was doing the work of 700 full-time agents. The reversal, confirmed by the company and documented in new workforce research, adds to a pattern of firms walking back aggressive AI-replacement claims after service quality suffered.

The February 2025 claim and the retreat

In February 2025, Siemiatkowski told the Financial Times that Klarna's AI assistant had taken on the equivalent of 700 customer-service roles [4]. (Klarna said in early 2024 that the assistant was built with OpenAI [5].) The company had already frozen hiring in August 2024 and shrunk headcount by roughly 22%, citing AI productivity gains [4]. By mid-2025, however, Siemiatkowski acknowledged the push had produced "lower quality" support, and Klarna began recruiting humans again through a remote, Uber-style pilot program [5].

A Klarna spokesperson told Fortune in early November 2026 that human agents were needed "for complex, sensitive cases" and that the company had begun directly hiring a "small number" of high-skilled people into the customer-service process to identify where the "human touch" adds most value [1]. The move amounts to a recalibration rather than a full reversal of its AI strategy.

Workers returning on new terms

The Klarna episode mirrors a broader trend. Research from talent-assessment firm SHL, published November 9, 2026, found that 19.1% of U.S. workers who were replaced by AI said they were later asked to return — a phenomenon SHL calls "AI rebounding" [1]. Among those who came back, 51% wanted a substantial pay increase, 42% said they would require written job-security guarantees, and 40% wanted transparency about how AI would be used in their roles [1].

A separate Robert Half survey of hiring managers found that 32% of organizations that cut positions because of AI later reinstated the same or similar roles. Among the reasons cited, 40% said the work required institutional knowledge AI couldn't replicate, 39% cited relationship management, 39% pointed to increased business demand, and 38% said more human oversight and quality control were needed than expected [1].

A pattern of premature replacement

Klarna is not alone. Ford hired and promoted 350 experienced engineers in June after AI-powered quality-control tools fell short of expectations; the automaker said AI contributed to gains but emphasized the need to combine it with deep technical expertise [1]. Gartner, analyzing more than 1 million layoffs in 2025, found that cuts genuinely driven by AI productivity — where one worker became so productive that fewer were needed — accounted for under 1% of the total [5]. The firm estimates that by 2029, 30% of employees terminated and replaced by AI will be rehired, often at higher cost, unless organizations overhaul workforce planning [5].

What the numbers show

Challenger, Gray & Christmas data shows U.S. employers cited AI in 121,401 announced job cuts through October 2026, more than double the 54,836 for all of 2025 [1]. Yet the same data shows AI dropping from the top-cited reason for cuts in March–July to fifth place in September, as companies including Zillow, Etsy, LinkedIn, Microsoft, Uber and HubSpot explicitly denied AI was driving their latest rounds [2].

The gap between claim and evidence

Siemiatkowski's claim that AI handled the work of 700 agents — made in early 2024 and reiterated to the Financial Times in February 2025 [4][5] — was widely cited as proof that large-scale AI replacement had arrived. The subsequent rehiring — and a detailed industry tracker's assessment that the AI "struggled with edge cases, emotionally complex interactions, and multi-step problem resolution" [2] — suggests the original metric measured ticket volume, not resolution quality. Customer satisfaction scores fell, and rehiring costs exceeded the original savings, according to the same tracker [2].

What remains unclear

Klarna has not disclosed how many roles it has rehired, what the net headcount change is since the 2024 freeze, or whether the "small number" of new hires represents a fraction or the bulk of the 700-agent equivalent it once claimed to have replaced. The company says it continues to use AI for routine queries while keeping humans for complex cases — a hybrid model [3].

The broader lesson, researchers argue, is that companies often automate the measurable parts of a role — volume, speed, script adherence — while underestimating the tacit knowledge, judgment, and relationship work that only becomes visible when it disappears.