The Impact of Artificial Intelligence on the Call Center Industry

The call center industry is undergoing significant changes as artificial intelligence (AI) becomes increasingly integrated into operations. Experts predict a decline in employment within this sector, as AI technology enhances productivity and may ultimately replace human workers.

Marie-Christine Fregin, an economist at Maastricht University, highlights that the demand for human agents in call centers is expected to diminish. The growing efficiency of AI could lead to a situation where human presence in call centers becomes unnecessary. The future of human employment in this field largely depends on corporate decisions.

Instances of call center closures are becoming more frequent. Recently, the German online retailer Otto announced layoffs affecting approximately 480 customer service employees, citing intensified competition, economic downturns, and shifts in consumer behavior, with customers increasingly preferring to manage their inquiries through apps rather than phone calls.

Data on the exact number of call center employees in Germany remains unclear. According to the Federal Employment Agency, around 127,000 professionals were employed in dialog marketing, which includes call center agents, in 2023. The industry association CCV estimates the total workforce at about 560,000, incorporating staff from corporate call centers.

Dirk Egelseer, president of the CCV, notes that the distribution of tasks within call centers resembles a pyramid. Most agents handle routine inquiries, such as tracking packages, while a smaller proportion manage more complex tasks involving banking or technical support, requiring extensive training and proficiency in multiple IT systems.

Both Fregin and Egelseer anticipate significant transformations due to automation. However, Egelseer believes that not all employees will be at risk. He observes a paradoxical trend where the demand for simple, mass-market services is declining, while the need for complex services is on the rise.

A pivotal question is whether AI will entirely replace basic customer service roles, as Egelseer suggests. In contrast, Fregin argues that AI has the potential to handle complex services as well, thanks to the emergence of AI agents capable of performing a wide range of tasks autonomously.

These AI agents can do more than just provide information; they can send forms, communicate with other departments, and even initiate calls to customers for promotional purposes. However, their widespread implementation is still in its infancy, according to Fregin.

One notable provider of AI agents is the Berlin-based startup Parloa. The company reports that its AI agents can make outbound calls, such as contacting customers who have booked flights to offer upgrades shortly before travel. Parloa has seen an increase in clientele, primarily from sectors like finance, insurance, retail, and energy, with clients including recognized names like Barmenia, Gothaer, Rossmann, and Eon One.

As AI continues to advance, the question arises: Who will occupy roles in call centers in the future? Fregin suggests that there may be fewer employees overall, but those who remain are likely to be better compensated and engaged in more complex tasks, as the simpler jobs are automated away. Egelseer echoes this sentiment.

In the context of labor relations, Volker Nüsse from the Verdi union highlights a trend of work shifting from traditional call centers to remote home offices. This transition poses challenges for union organization among members, given the current legal landscape. As the industry evolves, it is crucial to ensure that the interests and conditions of workers are adequately addressed amidst these changes.