AI's Efficiency Gains Come as 28,000 Translation Jobs Vanish

Klarna CEO Sebastian Siemiatkowski has become a vocal critic of the underplayed risks of artificial intelligence (AI) to employment, warning that tech leaders are failing to confront the scale of job displacement. Speaking to Bloomberg, Siemiatkowski argued that AI's impact on knowledge work-particularly in fields like translation-will be "massive" and immediate, despite optimistic forecasts from peers like Ford's Jim Farley and Anthropic's Dario Amodei. "New jobs will be created, but in the shorter term, that doesn't help the Brussels translator," he emphasized, noting that AI could already perform the bulk of translation tasks Klarna CEO halved his workforce to make way for AI—now, he’s …^[1].

Klarna's own AI-driven transformation underscores this stance. The fintech firm, known for its "buy now, pay later" service, reduced its workforce from 7,400 to 3,000 employees between 2023 and 2024, a cut Siemiatkowski attributed to aggressive AI adoption. The company deployed an OpenAI-powered chatbot capable of replacing 700 full-time customer service agents and launched an AI CEO hotline to handle queries in Siemiatkowski's conversational style. However, initial experiments faced backlash over poor customer experiences, prompting a shift toward balancing AI efficiency with human oversight AI Jobs Shock Is Coming and Firms Aren’t Ready, Klarna CEO Says^[2].

Financially, the strategy has paid off. Klarna reported a 38% year-over-year revenue growth in the U.S. and rising profits, enabling a September IPO with a $15 billion market cap. Siemiatkowski, a self-proclaimed "AI guinea pig," has integrated the technology into his personal life, using AI to explore Klarna's codebase and even appearing as an AI-generated replica during earnings calls Lost in translation: AI’s impact on translators and …^[3].

The CEO's warnings extend beyond Klarna, framing AI as a potential catalyst for economic disruption. He cited historical precedents where productivity booms led to recessions, particularly when automation disproportionately affects white-collar roles. "Productivity gains often come with short-term shocks, including recessions," he noted, linking AI-driven job losses to reduced consumer spending and financial instability Klarna CEO Warns AI Job Losses May Trigger Recession^[4].

The translation industry, a focal point of Siemiatkowski's critique, has already seen measurable impacts. A 2024 study found that machine translation tools like Google Translate correlated with a 0.7 percentage point decline in translator employment growth per 1 percentage point increase in AI adoption. By 2023, this effect translated to an estimated 28,000 lost translator positions in the U.S. over 13 years. Translators in high-demand languages like Spanish and Chinese also faced declining job postings, with AI's improving accuracy reducing the perceived need for bilingual expertise .

Despite these challenges, Siemiatkowski acknowledges AI's limitations. Klarna recently rehired customer service staff to ensure human interaction, recognizing that trust and nuance in customer support require human input. Similarly, AI struggles with creative and culturally sensitive tasks, prompting a shift toward post-editing workflows where humans refine machine-generated content .

The broader implications for the workforce remain contentious. While the U.S. Bureau of Labor Statistics projects a 4% growth in interpreter and translator jobs over the next decade, many professionals fear AI will erode demand for traditional translation. A 2025 survey by Acolad found that 84% of linguists expect increased reliance on post-editing, with 53% expressing serious concerns about AI's long-term impact on the profession .

Siemiatkowski's vision for the future hinges on redefining human roles alongside AI. "People should not be afraid of technology," he said, advocating for reskilling in areas like quality assurance and domain-specific expertise. Yet, his warnings highlight a stark reality: the transition to an AI-driven economy will require significant societal adaptation, particularly for workers in industries already facing obsolescence .