Monday, May 27, 2024

Despite AI onslaught, local BPO sector sees $32.16-B revenues in 2024

The country’s contact center and business process sector is expecting to post an estimated record annual revenue of around $32.16 billion in 2024.

The “conservative projection” is based on a yearly average sectoral revenue growth of about 9 percent, as indicated in an analysis by global industry research firm Everest Group.

In 2023, the contact center and business process sector posted an annual revenue of $29.50 billion, up by 9 percent compared to the annual revenue of $27 billion in 2022.

The sector’s yearly revenue accounted for 83 percent of the overall revenue posted by the country’s entire information technology and business process management (IT-BPM) industry of $35.5 billion and $32.50 billion in 2023 and 2022, respectively. Forecast IT-BPM industry revenue for 2024 is around $39 billion.

“The contact center and business process sector, along with the IT-BPM industry, has remained optimistic and positive in terms of revenue growth through the years,” said Mickey Ocampo, president of the Contact Center Association of the Philippines (CCAP), a sectoral organization with over 140 member-companies nationwide.

“The figures prove how resilient the sector has become, successfully overcoming the significant challenges that came its way, including stringent data privacy laws worldwide, the Covid-19 pandemic, global economic recessions, and now, the rise of generative artificial intelligence (AI),” he continued.

Ocampo is confident that the contact center sector could post an annual revenue of $49 billion by 2028. This is aligned with the IT-BPM roadmap 2028 that sets an industry yearly revenue target of $59 billion.

AI has been generating debates and concerns, especially among several national leaders, who believe the technology could possibly lead to job losses across important industries such as IT-BPM.

However, CCAP maintains its stance about the issue, consistently asserting how AI could help the sector grow further by increasing productivity of agents generation of AI-related job requirements.

“Our contact centers have been actively upskilling our people to equip them in handling their tasks more effectively. What does not kill us only makes us better and we have proven many times how constantly upgrading skills can help call center firms and our industry as a whole, not just overcome the challenges of the times but also perform better in what we do,” Ocampo explained.

In terms of full-time employment, the contact center sector also continues to provide jobs to more Filipinos nationwide. Still based on Everest Group data, call center firms employed 1.51 million individuals in 2023 — a 9.4 percent rise from 2022 figures. That number also accounts for about 89 percent of the total full-time employees (1.7 million) hired by the IT-BPM industry that year.

“Generative AI, which was among the issues discussed in last year’s Contact Islands conference, did not affect the industry figures negatively. We have even generated more jobs,” Ocampo highlighted, adding that the contact center sector’s 9.4 percent growth in employment for 2023 even outpaced the 8.6 percent employment growth posted by the IT-BPM industry.

The contact center and business process sector also continues to provide jobs to more individuals outside Metro Manila. In research conducted by CCAP with its member-companies as respondents in May 2023, 28 percent of call center firms indicated plans to establish sites in Cavite, while 23 percent said they will put up centers in San Fernando, Pampanga.

Other areas across the country that are being eyed by CCAP members include Rizal (21 percent), Batangas City (21 percent), Puerto Princesa in Palawan (21 percent), Laguna (18 percent), Iloilo (18 percent), Tarlac (15 percent), Cebu (15 percent), Davao (15 percent), General Santos City (15 percent), and Bacolod City (10 percent).

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