Will AI take BPO jobs in PH?

Summary

The video discusses the growth and challenges of the IT-BPM sector in the Philippines, highlighting its impressive 7% job growth for 2024, with 1.82 million Filipinos employed and generating $38 billion in export revenue. Despite global recession concerns and AI's impact, the sector remains strong, with the Philippines holding the second position globally in offshoring. Emphasizing the need for talent development and bridging skills gaps, the discussion also touches on the role of AI, cybersecurity, and the government's support in fostering a sustainable workforce. The future looks promising, with ongoing efforts to meet the demands of global industries like healthcare, finance, and banking.

Takeaways

• 😀 The IT-BPM sector in the Philippines is expected to grow 7% in jobs in 2024, employing 1.8-2 million Filipinos and generating $38 billion in export revenue.
• 😀 Despite global recession fears, the IT-BPM sector is still expected to outpace global growth rates, with the Philippines maintaining a strong position as the second largest offshoring destination worldwide.
• 😀 The sector aims to become less dependent on low-value tasks and focus on more complex, high-value services, which are less vulnerable to automation by AI.
• 😀 There is an ongoing skills gap in the workforce, particularly in English communication skills and domain-specific knowledge like data analytics, programming, and healthcare management.
• 😀 The private sector is taking proactive steps to address the talent shortage by investing in training and reskilling programs, with some companies even hiring straight out of senior high school.
• 😀 AI is viewed as an ally rather than a threat, creating new job opportunities in higher-value services while eliminating repetitive, low-value tasks.
• 😀 A survey of industry members showed that while 8% of jobs were lost due to AI, 13% more jobs were created, indicating a net positive effect on job growth.
• 😀 The Philippine IT-BPM sector is facing challenges such as cybersecurity threats, with an emphasis on ensuring customer data is adequately protected from cyber attacks.
• 😀 There is a strong focus on improving the educational system to provide workers with the necessary skills for the evolving IT-BPM industry, with suggestions for increased immersion hours for senior high school students.
• 😀 The government and private sector need to collaborate more effectively to address challenges like the talent skills gap, regulatory issues, and the implementation of flexible work policies, ensuring continued competitiveness in the global market.

Q & A

What is the projected growth for the IT BPM industry in the Philippines in 2024?

The IT BPM industry in the Philippines is expected to grow by 7% in jobs, with 1.82 million Filipinos employed directly by the industry. It is also projected to generate $38 billion in export revenue for 2024.

Why is growth in the IT BPM industry expected to be more modest in 2025?

The growth in 2025 is expected to be more modest because the industry is already operating from a high base, with IT BPM accounting for 8.5% of the country’s GDP. Additionally, potential global recession concerns could affect global volume, impacting growth.

How does the Philippines compare to India in the global IT BPM sector?

The Philippines is the second-largest offshoring center in the world, behind India. While India remains the top center due to its larger population, the Philippines has consistently outpaced global growth rates in IT BPM.

What role do Overseas Filipino Workers (OFWs) play in comparison to the IT BPM sector?

The IT BPM sector, with its diverse set of jobs, provides a pathway to the middle class for many Filipinos. While OFWs are crucial to the economy, the IT BPM industry also contributes significantly by generating similar levels of revenue and providing a wide range of jobs.

What are the key skills gaps the IT BPM sector faces?

The IT BPM sector faces gaps in both soft skills and domain-specific skills. For soft skills, there is a need to enhance communication, comprehension, and critical thinking. Domain-specific skills, especially in areas like data analytics, programming, and healthcare, are also in high demand.

How is AI affecting the growth and job roles within the IT BPM industry?

AI is expected to impact the IT BPM industry by automating low-level, repetitive jobs. However, it also creates new roles, particularly in higher-value tasks, such as AI-related positions. AI is being adopted in the industry, with many companies already implementing AI trials and use cases.

What steps is the Philippine government taking to address the skills gap in the IT BPM sector?

The government, through discussions with industry stakeholders, is focusing on improving education, such as bringing back English as a medium of instruction and increasing on-the-job training hours for senior high school students. These efforts aim to better align the talent supply with the industry’s needs.

What role does cybersecurity play in the IT BPM industry, and what are the challenges?

Cybersecurity is a critical concern in the IT BPM industry because it handles sensitive customer data. There is a need for robust protection against threats like ransomware and hacking. Companies must ensure their cybersecurity measures are in line with industry standards, while the government should enforce minimum security standards.

Are new companies still interested in setting up operations in the Philippines despite existing challenges?

Yes, the Philippines remains an attractive destination for foreign companies due to its competitive workforce and favorable demographic advantage. The country’s ability to scale its workforce, combined with the talent pool, continues to make it an appealing location for businesses.

What sectors are showing the most promise for growth in the IT BPM industry in the coming years?

Sectors such as banking, financial services, and healthcare are expected to see the most growth. These sectors are becoming increasingly digital and require specialized skills, making the Philippines a strong contender for providing outsourced services in these areas.