A customer calls to dispute an incorrect charge. After navigating six automated menu options, repeating personal details to a chatbot and spending 20 minutes on hold, there is still no human agent in sight. For companies, automated customer service has become a symbol of productivity: fewer employees can serve an ever-growing customer base. For those on the other end of the line, however, the efficiency gains are not always so apparent.
Brazil’s new customer service regulations, which take effect on November 2, will require greater access to human assistance, shorter waiting times and simpler cancellation procedures. The changes could increase operating expenses for companies that have invested heavily in automation. At first glance, this may look like a step backward for productivity. But the more relevant question is how much of the efficiency gained reflects a genuine reduction in the resources needed to deliver a service — and how much merely reflects the transfer of work to consumers.
Labor productivity is generally measured by the amount of goods and services produced per hour worked. By that measure, a company that serves more customers with fewer employees becomes more productive. The problem is that this calculation does not necessarily account for the hours consumers spend trying to resolve problems. If a business saves five minutes of an employee’s time by forcing a customer to waste 20, its internal productivity may improve without any corresponding gain in economic efficiency. The work has not disappeared. It has simply changed hands, becoming unpaid labor that no longer appears on the company’s expense ledger.
Simpler cancellation procedures also have economic consequences. Making it difficult for customers to leave increases switching costs, allowing businesses to protect revenues without necessarily improving their products or services. Removing those barriers could increase customer churn and squeeze profit margins, but it could also strengthen competition and shift business toward more efficient providers. An economy’s productivity depends not only on how effectively individual companies use their resources, but also on whether competition rewards those that put resources to better use.
Artificial intelligence will still be able to handle routine requests, and its productivity gains are real when it reduces the time and effort required to serve customers. The new regulations are not without risks: excessive requirements could raise costs without delivering proportionate benefits. But there is a fundamental difference between eliminating work and making someone else do it for free. A company can appear more productive by shifting its costs onto customers. The economy as a whole does not necessarily become more productive as a result.
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