AI transforming, not cutting PH outsourcing jobs–ING Bank study

The artificial intelligence (AI) boom has not yet caused a decline in the Philippines’ service-export revenues or employment, ING Bank N.V. said, arguing that AI is so far changing what gets outsourced rather than reducing demand for outsourced work. In a report, Deepali Bhargava, head of Asia-Pacific research at ING, said there was evidence that AI is transforming the nature of outsourced work rather than reducing demand for it. "AI is changing what gets outsourced, not reducing the demand for outsourced work," Bhargava said. She said AI is facilitating the automation of existing processes and driving a shift towards tasks requiring higher-level skills. This presents an opportunity for the Business Process Outsourcing (BPO) sector to evolve from handling routine tasks to providing more value-added services. The Philippines has long been a key global outsourcing destination, particularly for English-speaking countries, handling services like call center operations and IT support. This industry is a significant contributor to the nation's economic growth and job creation, serving as a major source of foreign exchange alongside overseas Filipino workers (OFWs). While AI may automate some routine tasks, it is also expected to create new demands for skilled personnel in areas such as managing AI tools, data analysis, and complex customer interactions. This scenario underscores the need for the Philippine education system and vocational training programs to focus on developing skill sets suitable for the AI era, aligning with future labor market demands. Continuous investment and adaptation strategies from both the government and the private sector will be crucial for the country to overcome this wave of change and maintain the competitiveness of its outsourcing industry.