Unprompted: The AI Workforce Shuffle Is Here

Unprompted is an occasional opinion column from Kunal Gupta for Pivot 5 readers.

Recently, I met a friend who’d just been let go from a large financial services firm. She wasn’t bitter; she was stunned. The company’s AI-powered pilot program—originally sold to employees as a tool to help you work smarter—had done its job too well. Within six months, her team of customer service reps was mostly gone, replaced by a system that resolved inquiries faster and more cheaply than any human could.

Her story reflects a seismic shift happening right now in business: AI isn’t just assisting employees—it’s outright replacing many of them.

Klarna: Efficient and Controversial

Swedish fintech Klarna is famous for its “buy now, pay later” model. But in 2022, it made headlines for a different reason: the company laid off around 700 employees—roughly 10% of its workforce—to reduce costs. Shortly after, Klarna introduced an OpenAI-powered customer service chatbot that now handles about two-thirds of all customer inquiries, roughly 2.3 million in a single month. According to internal data, this AI system accomplishes routine tasks nine minutes faster than human agents on average.

The payoff? Klarna reported a 27% year-over-year revenue jump in early 2024, and revenue per employee soared by over 70%. CEO Sebastian Siemiatkowski publicly touted the improvements, saying AI can do “virtually anything” once performed by staff. Yet some criticized his tone. 

When he boasted on social media that his marketing team was half the size it was last year yet somehow more productive, employees and observers found it insensitive—proof that an AI-powered future can spark a morale crisis if leaders don’t communicate changes thoughtfully.

Klarna’s lesson: AI can deliver dramatic efficiency gains, but the human cost—both in lost jobs and shaken morale—looms large. If you’re going to automate roles, transparency and empathy matter just as much as cost savings.

BuzzFeed: Losing a Newsroom

In the digital media space, BuzzFeed stands out for its embrace of AI. In late 2022, it laid off 12% of its staff (about 180 people), then more cuts followed in April 2023—another 15%—as it shut down BuzzFeed News entirely. CEO Jonah Peretti said the future of “static content” was AI-generated: quizzes, listicles, even some sponsored pieces. And for a time, the market cheered. BuzzFeed’s stock price surged when it announced a partnership with OpenAI.

But cracks emerged. AI-generated articles were occasionally dull or riddled with errors, damaging the brand’s credibility. Readers noticed, and critics derided the site for pushing “low-quality clickbait” churned out by an algorithm. While BuzzFeed did save on staffing costs, leadership acknowledged that over-reliance on AI risked alienating loyal readers—and overlooked the creative edge that human writers once brought.

BuzzFeed’s lesson: AI can quickly replace knowledge workers, but quality and brand trust can suffer if it isn’t carefully managed. Yes, companies may benefit from higher output at lower cost, but they can also lose the authenticity that made them stand out in the first place.

IBM: Calculated Automation

Unlike Klarna or BuzzFeed, IBM chose a more measured route. In mid-2023, CEO Arvind Krishna announced plans to pause hiring for back-office roles like HR, believing AI could eventually handle up to 30% of those tasks. That translates to about 7,800 jobs potentially replaced by automation over the next few years. Instead of immediately firing thousands of employees, IBM is relying on natural attrition: as people retire or resign, many of those positions won’t be refilled.

Early indicators suggest that IBM’s approach is less disruptive. Back-office productivity has risen, and the company touts that by gradually automating repetitive tasks—such as screening job candidates or generating routine reports—remaining staff can focus on more complex, strategic work. Even so, critics point out that fewer jobs is fewer jobs, no matter how gently you approach it.

IBM’s lesson: A “slow and steady” strategy can avoid mass layoffs and preserve morale. But transparency is crucial, too. IBM’s leadership has been vocal about how it sees AI shaping the company, making it clear they’ll also invest in technical hires to build and oversee these systems.

The Bigger Picture: Embracing AI Without Losing Our Humanity

When you combine these snapshots—Klarna’s rapid cuts, BuzzFeed’s embrace of automated content, IBM’s phased approach—it’s clear that AI-driven job displacement isn’t a hypothetical future; it’s already here. The question is less about whether AI will take jobs (it will) and more about how companies can manage this transition responsibly.

Communicate the why. Employees want to know if AI is just a cost-saving measure or if it opens new career paths. Reinvest in human skills. Over-reliance on AI can dilute quality and trust, so keep humans in the loop. Go gradual when possible. Pilot projects allow you to adapt and learn without uprooting your entire team. 

Ultimately, AI presents an opportunity to free humans from drudgery, letting us focus on more creative and complex tasks. But that optimistic vision depends on how well businesses handle the transformation today. 

Companies that see AI solely as a way to cut headcount risk losing institutional knowledge and goodwill. Those that deploy it thoughtfully—communicating openly, reinvesting in human talent, and pacing the transition—stand to thrive in an AI-powered future.

As for my colleague who lost her job? She landed at a startup that uses AI to automate back-office work but actively invests in training and development. “Tech changes fast,” she told me, “and I’m okay with that, so long as we keep sight of the people behind the machines.” That might be the best summary of where we are right now: the machines aren’t going away, but neither is our humanity, and the best companies will recognize the value of both.

Unprompted is an occasional opinion column from Kunal Gupta for Pivot 5 readers. Follow Kunal on LinkedIn.