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World leaders confront AI layoffs; more in store for contact centers
Apprenticeship may solve the problem of training new contact center hires after AI vacuums up all the entry-level jobs humans now perform.
In contact centers, AI job replacement will not be evenly distributed.
Two recent reports examine how AI is affecting customer service amid a massive disruption caused by the technology. Customers are making their expectations of AI service bots known, and they are not showing much patience for incorrect or off-target AI responses -- so they leave and try competing products.
Meanwhile, several national, state and city governments are mulling over different regulatory approaches to slow AI's replacement of humans.
Looking at the next two to five years, AI will transform the contact center workforce by eliminating some jobs while creating new -- albeit fewer -- roles for specialists to monitor, update and manage AI agents, predicted Forrester Research in a report released July 1 titled "The Quantitative Employment Impact Of AI On Customer Service Jobs."
Highly skilled and empathetic human agents will always be needed to tackle complex cases that AI can't solve, said co-author and analyst Kate Leggett.
What's more, different verticals will reshape their contact center workforces differently, depending on the complexity of the work and the human touch those industries require to maintain quality service and customer loyalty.
Industries such as retail, hospitality and food service -- especially companies with large, high-volume contact centers -- will likely lose more jobs to AI automation than utilities, manufacturing, construction, banking and insurance.
Employees at those companies, which require more specialized agent knowledge, are not only less vulnerable to AI replacements, but they also typically command higher salaries.
"Some jobs in industries like retail and food services, arts and entertainment, your customer service reps are paid pretty poorly -- barely a living wage," Leggett said. "Those jobs are getting replaced by AI because they tend to the simpler questions [such as]: 'Where's my order?' 'Does this dress come in blue instead of green?' 'How do I do returns, exchanges, refunds?'
"In industries like utilities, mining, manufacturing -- where salaries are much higher, and where you're working on harder [cases] -- there's less pressure to get rid of jobs, because they're more complicated and harder to automate."
But the adoption of AI also presents contact center leaders with several workforce issues to solve. One is onboarding and training new contact center hires when all the entry-level jobs are gone. Another is deploying technically skilled workers on the front lines to keep AI agents updated and on point, especially when an issue -- for example, a newly discovered product defect -- causes a surge in calls and management sets return policies on the fly.
One solution may be customer service teams, or pods, consisting of a couple of agents, a manager and an AI specialist within the contact center ranks, Leggett said. Such a model would also allow entry-level workers to apprentice alongside more seasoned veterans, learning to solve thorny customer issues. Regardless of how contact centers change their staffing models, she sees apprenticeship as an important component of AI transformations.
Also, AI is unlikely to take over every contact center at once.
"Not all contact centers are going to agentify their operations in two years or five years," Leggett said. "There's a lot of entry-level work that still exists. Some contact centers will never be able to get to the automation rates that we project because they're just not set up for it -- they're not technology-forward, they haven't cleaned up their data, they haven't cleaned up their processes. So, there are jobs that will be out there."
Replacing humans with AI: Illegal?
Truth be told, AI has not precipitated significant job cuts in the economy overall, though there are some notable exceptions, specifically in customer service. Salesforce, for example, laid off 4,000 customer support staff in 2025.
This is probably in part why regulators have only begun to examine the idea of regulations that restrict employers' ability to replace humans with AI agents.
That said, efforts are underway globally to address the issue. In China, courts have limited companies' ability to reduce head count due to AI. The European Union's AI Act has telegraphed possible future intent to limit AI layoffs.
In the U.S, New York has a disclosure law on the books that requires companies to notify when AI precipitates layoffs -- which no company has done yet -- and a proposed bill in the California Senate would require employers to give employees 60 days' notice for "technological displacement."
Separately in California, last May, Governor Gavin Newsom signed an executive order exploring new policies for severance standards, employment insurance and support for workers displaced by "AI transition." Some U.S. attorney groups are considering novel uses of federal National Labor Relations Act protections to give unions negotiating power in the face of AI layoffs. The National Labor Relations Board has yet to issue an opinion on it.
The upshot of all this? Regulations may eventually come, but right now, regulators and courts are in what developers might call early alpha testing.
Customers getting testy with AI service
Contact centers, as they grapple with the math of AI layoffs and upskilling the humans who are left, have another challenge: The majority of customers are growing increasingly impatient, expect AI to deliver better service than humans, and would literally rather do anything than contact customer service.
Even CX leaders indicated they don't want to deal with customer service in their personal lives.
That's according to the "2026 State of Customer Experience Report” of 5,800 consumers of all ages, across 20 countries -- and 1,500 CX leaders across numerous verticals, including telecommunications, automotive, manufacturing, airlines and retail, to name a few -- conducted by CX vendor Genesys. The comprehensive survey took place last March and April.
Yet only 24% of CX leaders globally believe their service organizations are minimizing the effort required for consumers to resolve their issues, even as they hand off work to a hybrid human-AI agent workforce. Challenges to reducing customer friction in contact centers include a lack of data readiness, aging infrastructure and systems that still require customers to repeat their information -- or contents of a chatbot conversation -- to a human after an AI agent hands them off.
But they're running out of time: 95% of consumers expect that they won't have to repeat these things to a human contact center agent. On top of that, 85% of consumers said they either spent less with a brand or stopped using it altogether because of poor customer service.
"Poor customer service" in the context of AI means the agent has three attempts to resolve a customer query. That's it, said 84% of consumers. They've thrown down the gauntlet and given CX leaders more information to feed into their algorithms, calculating what they will lose if they mismanage AI layoffs and hand over too much to the bots.
Don Fluckinger is a seasoned B2B technology journalist with more than 30 years of experience specializing in enterprise IT, digital experience and content management. As a senior news writer at Informa TechTarget, he delivers award-winning analysis that helps IT and business leaders navigate complex technologies to enhance customer and employee experiences. Got a tip? Email him.
