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Manila Bulletin devider Business devider The Economy devider Balisacan says AI threat to Philippine BPO jobs may be overstated

Balisacan says AI threat to Philippine BPO jobs may be overstated

Published Aug 14, 2026 02:59 pm

Fears that artificial intelligence (AI) could lead to massive job losses in the Philippines’ information technology and business process management (IT-BPM) industry may be overstated as the sector continues to grow despite the rapid adoption of the technology, the country’s chief economist said.

Speaking at the Economic Journalists Association of the Philippines (EJAP) Economic Forum on Friday, Aug. 14, Department of Economy, Planning, and Development (DEPDev) Secretary Arsenio Balisacan said developments in the IT-BPM sector have shown encouraging signs of the Filipino workforce’s ability to adapt to AI.

According to Balisacan, concerns that the Philippines could lose a substantial portion of its IT-BPM industry because of AI appear to be exaggerated, given that the sector continues to expand even as the technology becomes more widely used.

Balisacan identified innovation and productivity as major sources of economic growth, alongside the need to upskill the country’s labor force to adapt to emerging technologies, including AI.

The DEPDev chief also pointed to the proposed Pax Silica development as an opportunity to diversify the Philippine economy. According to Balisacan, projects such as Pax Silica could improve the quality of economic growth by attracting investments that support industrialization and value-adding activities.

His remarks come amid warnings that the Philippines could be particularly vulnerable to AI disruption because of the importance of the business process outsourcing (BPO) sector to employment and the economy.

In a report published last Wednesday, Aug. 12, think tank Capital Economics said the Philippines risks falling behind the global AI boom as it benefits less from the surge in AI-related electronics exports while its BPO industry faces growing exposure to automation.

Capital Economics senior Asia economist Gareth Leather noted that the BPO sector directly employs around 1.8 million workers, generates roughly $40 billion in annual export revenues, and accounts for around seven to eight percent of gross domestic product (GDP).

Industry estimates cited by Capital Economics suggest that around one million BPO-related jobs in the Philippines could be vulnerable to automation by 2030.

The think tank also noted that the Philippines ranked 43rd out of 47 economies in its AI Economic Impact Index, with a score of 21 out of 100.

The Philippines, meanwhile, is seeking to attract AI, semiconductor, advanced manufacturing, and other high-value investments through its participation in the United States (US)-led Pax Silica initiative.

The Philippines and the US are developing a nearly 1,619-hectare (ha) economic security zone in New Clark City in Tarlac province, envisioned as the first AI-native industrial acceleration hub under Pax Silica.

Earlier, the World Bank said AI could help developing economies accelerate productivity, although the technology could also disrupt employment in industries with tasks susceptible to automation.

Asked about environmental concerns surrounding Pax Silica, including the substantial water and electricity requirements associated with AI infrastructure and data centers, Balisacan said the proposed development extends beyond those facilities.

According to Balisacan, state-run Bases Conversion and Development Authority (BCDA), which is preparing the master plan, has discussed the environmental concerns and is looking at technologies and safeguards intended to protect the environment.

Related Tags

Capital Economics Department of Economy Planning and Development (DEPDev) Arsenio M. Balisacan artificial intelligence (AI) business process outsourcing (BPO) information technology and business process management (IT-BPM) Pax Silica New Clark City
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