AI Is Causing a Major Shift in Customer Service

Artificial intelligence is beginning to change the relationship between business growth and customer service hiring, Forrester Research notes in a new report.

The research also challenges the narrative that AI simply replaces workers. Instead, the research firm reports that work is being restructured: Routine, high-volume tasks are increasingly automated, while demand grows for employees who can manage AI systems, analyze interactions, and resolve more complex customer issues.

Companies continue to invest in customer service technology as they prioritize operational efficiencies, customer retention, and growth, Forrester says, noting that 86 percent of software decision makers said their organizations are adopting or planning to adopt customer service software.

Forrester says it is important for companies to continue investing in customer service technology, particularly as it has identified the following current and expected customer service labor market trends:

• Customer service job postings, already in decline, will see further contraction. Such job listings are already 10 percent below pre-pandemic levels, even though there are more total U.S. jobs now than before the pandemic.
• Customer service salaries are stagnating. This trend started in mid-2025, while other jobs have seen salary increases since that time. Median annual pay for customer service representatives rose from $35,800 in 2020 to about $39,700 in 2023, with mean wages increasing from about $39,000 to $43,500 over the same time frame.
• Most of the wage growth was between 2021 and 2022, due to labor shortages and high turnover.
• Retail and administrative support services will be the customer service roles most impacted by AI, while customer service jobs in utilities, mining, and wholesale trades are better paid and more resilient.

The research also found that companies are prioritizing investments in automation over customer service talent. Outside of budget reductions, 42 percent of businesses and tech professionals said their organizations are seeking to cut expenses by investing in AI and other automation to improve employee productivity.

Other Expected AI-Driven Changes

The customer service profession will change as AI reduces the number of generalists and produces new customer service specialists, Forrester predicts further.

As evidence, the research firm singles out Bank of America's virtual assistant, Erica, which already handles about 2 million transactions a day, offloading the work of about 11,000 employees. Erica handles routine transactions, such as basic financial questions, transaction history, account balances, etc.

With Erica and similar AI assistants handling routine transactions and inquiries, there is increasing demand for specialists who can offer real-time intelligence and deeper customer insight, Forrester says.

AI will transform customer service operations beyond cost reduction to deliver greater business value, predicts the research firm, which expects organizations to use the technology to improve customer service quality while better aligning front-office teams around shared objectives. It can, for example, surface emerging issues, sentiment trends, and product gaps that teams across the organization can use to increase revenue and profits, Forrester says.

Among other key findings in the report are the following:

• Declines in customer service representative employment will continue through 2031 as AI automation expands.
• AI has the potential to autonomously resolve 60 percent to 80 percent of routine customer inquiries, reducing demand for many entry-level customer service roles.
• Employers are creating new roles focused on AI oversight, conversation intelligence, quality analytics, and handling more complex customer interactions.
• Organizations are beginning to decouple customer demand from headcount growth. Historically, higher service demand meant hiring more agents, but AI is increasingly allowing companies to scale customer support without proportionally expanding their workforces.

"Navigating this transition will be bumpy," Forrester cautions."Some contact centers may never reach the level of projected automation rates. [Other] contact centers will not develop specialized talent to uplevel operations."