By Madelaine B. Miraflor
The Business Process Outsourcing (BPO) sector started to see the need to heighten efforts to address the possible impact of what is described as “disruptive technological headwinds” — such as artificial intelligence (AI), automation, and robotics — to the industry’s Filipino workforce.
This, while the sector is now projected to only grow by 9 percent annually starting this year until 2022 in terms of revenues, which is slower than the “mid-teen” growth it experienced in previous years.
Information Technology and Business Process Association of the Philippines (IBPAP) President Rey Untal said that with the “looming threat of AI and automation” to the BPO sector, their organization decided to elevate the discussion on this issue during the upcoming 9th International IT-BPM Summit in October.
“Many experts are predicting that the workforce is in danger of being replaced by automation but that is simply not the case. What is often overlooked about automation is that while it is expected to impact certain jobs in the sector, this will also enable the IT-BPM Industry to move up the value chain, resulting in an increase in mid-skilled jobs and high skilled services,” Untal said in a briefing on Wednesday held in Makati.
“That is why it is important for us to continue the conversation at the Summit, where we have experts flying in from all over the globe to discuss the impact of technology and the future of the industry in great deal,” he added.
A data from the Philippine Statistics Authority (PSA) showed that new investment pledges in the IT-BPM sector actually went down by 34 percent year-on-year in the second quarter, while investment commitments in BPO sector alone particularly slid from R6.27 billion to R4.9 billion from April to June period.
Jojo Uligan, Contact Center Association of the Philippines (CCAP) President, said the industry wants to answer all the issues affecting the industry, especially on the concerns regarding AI and automation.
To date, call center operations represent 67 percent of this industry.
“We need to protect our industry and workers. We’ve been talking about this for awhile. Our success in this industry is our people. We have to make sure that we protect them, make them stay relevant, and educate them. Yes, the industry would feel certain impacts but what we are focusing on are the opportunities,” Uligan also told reporters.
Meanwhile, officials of real estate services firm Santos Knight Frank shared a rather different outlook on the BPO sector.
While the popular sentiment is that the sector will slightly retrieve — eventually paving the way for online gaming sector to emerge as the top taker of office spaces in the country — moving forward, the multinational company said the office space demand from the BPO sector will actually even grow faster than usual.
For one, Santos Knight Frank Senior Director for Research and Consultancy Jan Custodio doesn’t believe that online gaming sector, even if it’s starting to grow a bit faster now, can outshine BPO in terms of office space take-up.
“We are not seeing a slowdown in the BPO sector any time soon. Online gaming will just augment the growth in the office sector. We are not worried about online gaming growing too fast,” Custodio said in a different press briefing also held yesterday.
“We have a different position from IBPAP and other service providers… We believe the BPO sector will continue to grow in the future,” he added.
To recall, Real estate expert David Leechiu said earlier this week that as the slowdown of inflow of BPO investments in the country becomes more apparent, online gaming is now seen as a potential saving grace for the real estate sector as it is projected to take up the demand for office spaces.