The business process outsourcing (BPO) industry in the Philippines faces a critical shortage of skilled technical talent amid its continued integration of artificial intelligence (AI), putting the country’s position at risk in the global BPO market.
Talent shortage limits growth potential
The IT and Business Process Association of the Philippines (IBPAP) has expressed concern over the insufficient number of graduates with the appropriate technical and communication skills to fulfill industry demands.
According to IBPAP President and CEO Jack Madrid, this shortfall could prevent the sector from adding up to 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,” Madrid said, highlighting the gap between industry needs and the current workforce’s abilities.
The shortage is particularly severe in AI-trained talent. Despite a 60% AI adoption rate within information technology and business process management (IT-BPM) firms, many companies struggle to find employees equipped to handle AI technology.
Challenges of AI adoption
Dominic Vincent D. Ligot, founder of Cirrolytix Research Services and head of AI and research at IBPAP, emphasized concerns as more companies adopt AI technologies.
“There are lingering concerns about data privacy, security, and integration with legacy systems,” Ligot said. “The biggest hurdle we need to address is the lack of AI-equipped talent in the market.”
He pointed out that Philippine schools have a “massive shortage” of teachers knowledgeable in Al, hindering the development of an AI-ready workforce.
Bridging the skills gap
Efforts are already underway to address these issues.
One solution is the Philippine Skills Framework for Analytics and Artificial Intelligence (PSF-AAI), a collaboration between the Department of Information and Communications Technology (DICT) and the Analytics and Artificial Intelligence Association of the Philippines (AAP).
The framework offers a roadmap for individuals seeking careers in AI and data analytics. This initiative aims to align educational outcomes with industry demands, helping to close the talent gap.
Legislative support for AI development
At least eight bills focusing on different aspects of AI are pending in Congress, including the creation of an AI Development Agency and a National Center for AI Research. These bills also tackle labor protection, governance, and the ethical challenges AI poses, such as deep fakes.
“These legislative efforts highlight the complexity of AI governance,” Ligot further said, stressing the need to balance innovation with protection for the most vulnerable.
Outlook for the BPO industry
Despite the challenges, the Philippine BPO sector is expected to continue growing, with projections of reaching $59 billion in annual revenue by 2028. AI adoption, combined with efforts to close the talent gap, will be vital to maintaining the industry’s global competitiveness.
Read more Unity Communications and industry news on our main BPO News page.
Analytics & Artificial Intelligence Association of the Philippines. (2024, May 7). DICT, AAP launch Philippine Skills Framework for Analytics & AI. Retrieved from https://aap.ph/news/13353419
Tabile, J. I. (2024, September 5). Talent shortage may hamper adoption of AI among Philippine BPO firms. BusinessWorld Online. Retrieved from https://www.bworldonline.com/top-stories/2024/09/06/618940/talent-shortage-may-hamper-adoption-of-ai-among-philippine-bpo-firms/
PBEd. (2024, May 8). Skills Map for Careers in Analytics and Artificial Intelligence Launched. PBEd. Retrieved from https://pbed.ph/news/154/PBEd/skills
Joshi, R., & Ranosa, T. (2024, August 24) How the Philippines is adopting AI in the BPO industry. People Matters. Retrieved from https://www.peoplemattersglobal.com/article/technology/how-the-philippines-is-adopting-ai-in-the-business-process-outsourcing-industry-41952
GOVPH Department of Trade and Industry. (2024, July 2). DTI launches National AI Strategy Roadmap 2.0 and Center for AI Research, positioning the Philippines as a Center of Excellence in AI R&D. Retrieved September 12, 2024, from https://www.dti.gov.ph/archives/news-archives/dti-launches-national-ai-strategy-roadmap-2-0-center-ai-research-positioning-philippines-center-excellence-ai-rampd/
