• 3,000 firms
  • Independent
  • Trusted
Save up to 70% on staff

News » AI, talent deficit threaten Philippine BPO industry

AI, talent deficit threaten Philippine BPO industry

AI talent deficit threaten PH BPO
Photo from Business World

MANILA, PHILIPPINES — The Business Process Outsourcing (BPO) sector in the Philippines faces dual challenges from emerging artificial intelligence (AI) technology and a talent shortage, threatening its stake in the global $300 billion BPO market. 

Industry group IT & Business Process Association of the Philippines (IBPAP) warns that the country is generating a low ratio of graduates with the necessary communication and technical skills, potentially missing out on adding 800,000 jobs in the next five years.

“The most common challenge I hear is comprehension… I think they fail at a more basic level,” said IBPAP President and CEO Jack Madrid.

The country’s quality of education has slipped, with nine out of 10 Filipino children unable to comprehend simple text by age 10, as per World Bank data.

Madrid also noted a gap in basic IT skills, such as programming and troubleshooting, which BPOs increasingly require. Due to this employability crisis, only one gets hired for every 10 outsourcing job applicants.

The country also faces a threat from AI and similar technologies, expected to displace nearly a quarter of the workforce in the Philippine outsourcing industry by 2030, as estimated by the Asian Development Bank.

“There are some fundamental weaknesses in our educational system… It’s an old problem, but it’s just become much more urgent now,” Madrid added.

Earlier this year, Philippine Senator Risa Hontiveros expressed concern over AI’s impact on the local outsourcing industry, particularly its employees. Hontiveros suggested launching training programs to help Filipinos to work “alongside” intelligent machines.

Despite these trials, the IBPAP chief remains hopeful, projecting a growth of 6%-7% in full-time BPO employees and a revenue surge of 7%-8% to roughly $35 billion this year. 

Madrid also revealed that IBPAP had partnered with the Philippines’ Commission on Higher Education (CHED) on initiatives, including a revamp of the IT education program to align with current trends and develop competencies in the sector.

Read more here.

Start your
journey today

  • Independent
  • Free
  • Transparent

About OA

Outsource Accelerator is the trusted source of independent information, advisory and expert implementation of Business Process Outsourcing (BPO)

The #1 outsourcing authority

Outsource Accelerator offers the world’s leading aggregator marketplace for outsourcing. It specifically provides the conduit between Philippines outsourcing suppliers and the businesses – clients – across the globe.

The Outsource Accelerator website has over 5,000 articles, 350+ podcast episodes, and a comprehensive directory with 900+ BPO companies… all designed to make it easier for clients to learn about – and engage with – outsourcing.

About Derek Gallimore

Derek Gallimore has been in business for 20 years, outsourcing for over eight years, and has been living in Manila (the heart of global outsourcing) since 2014. Derek is the founder and CEO of Outsource Accelerator, and is regarded as a leading expert on all things outsourcing.

“Excellent service for outsourcing advice and expertise for my business.”

Learn more
Banner Image
Get 3 Free Quotes Verified Outsourcing Suppliers
3,000 firms.Just 2 minutes to complete.
SAVE UP TO
70% ON STAFF COSTS
Learn more

Connect with over 3,000 outsourcing services providers.

Banner Image

Transform your business with skilled offshore talent.

  • 3,000 firms
  • Simple
  • Transparent
Banner Image