AI and the future of employment: Is the Philippines ready?

It’s been awhile since the last time I wrote. But I believe now is the best time to get back to it, with the future looking both exciting and uncertain. Geopolitics, technology, climate change, national security and economics are all rapidly changing. I’d be remiss in my duties if I didn’t start writing again.

The simple answer to the question of my column is no, we aren’t ready. But it’s a bit more complicated than that. I’m not here to point fingers. I’d rather try and share the problem and offer solutions. There are many moving parts, but it’s not too late.

Let’s face the facts: there’s no national artificial intelligence (AI) policy framework, no workforce transition program and no full-on national AI adoption plan in our educational system.

I’m here to offer a stern warning: if we don’t lay the digital foundation today, our young people will suffer the consequences – impending job loss, lack of competitiveness and the disruption of our economy as we know it.

Recently, I came across the policy brief that was published by the International Labor Organization (ILO) on generative AI (GenAI) and jobs in the Philippines sometime last month. It focused mostly on Philippine labor market exposure and policy implications and how the adoption of AI can impact the information technology-business process management (IT-BPM) sector.

The policy brief notes that around 12.7 million jobs, which is more than a quarter of employment here, is exposed to GenAI. This is the highest rate among ASEAN countries. The ILO remains confident that GenAI exposure does not necessarily imply full job replacement, but rather the automation of certain tasks within occupations. Research shows that only 3.6 percent of jobs fall into the highest GenAI exposure category. The ILO believes that the primary impact of GenAI on the Philippine labor market will be the transformation of existing jobs, productivity gains and improvements in employment quality.

The policy brief aligns with issues discussed during the recent hearing of the committee on economic affairs. During the hearing, I raised concerns regarding how the continuous rise of AI could affect our IT-BPM industry. The Philippines has been considered as one of the largest global business process outsourcing (BPO) and IT-BPM service providers for the past two decades. In 2024 alone, the IT-BPM industry consisted of 1.8 million workers, which represented 3.8 percent of the total employment of the country and generated revenues equivalent to 8.2 percent of GDP.

A major concern is the potential impact on women and the youth. These groups often depend on the BPO sector as a key source of entry-level employment. Research findings suggest that GenAI exposure, either by job transformation or job displacement, is likely to affect women more. Occupations usually held by women have higher exposure rates that those held by men. Three out of five clerical support workers and/or service and sales workers are women; more than half of technicians and associate professionals are also women. As for the youth in general, the exposure rate is slightly lower than those of adults. However, approximately 217,200 jobs, or 4.2 percent of all jobs filled by young workers, were identified as higher-risk of GenAI-induced automation.

However, we can still prepare for this transition by urgently investing in upskilling, technical education and digital training programs; these will help them adapt and move into higher-value roles. The Department of Labor and Employment (DOLE) has acknowledged that some Filipino workers are already experiencing job displacement linked to automation. Some KPO and BPO firms, including Botkeeper and Atlassian, have reportedly shut down operations, though the companies have not indicated that these closures were entirely attributable to AI.

The potential economic consequences of a significant decline in the IT-BPM industry cannot be overlooked. In 2024 alone, the sector generated revenues equivalent to 8.2 percent of GDP. While the data for 2025 is still being finalized, the IT and Business Process Association of the Philippines (IBPAP) has reported that the industry generated over $40 billion in revenue. Beyond direct employment, the IT-BPM industry remains a major source of export earnings and supports millions of additional jobs across related sectors such as transportation, food services, retail and real estate.

To address these challenges, several measures should be considered:

1. Proactive Infrastructure & Policy Adjustments. The government should remodel and/or modernize existing infrastructure and invest further in digital infrastructure. A big part of this would be the National Broadband Plan, common towers for greater connectivity, free WiFi program of the government and leadership of the DICT.

2. Revisit existing laws and policies governing education, workforce development and the digital economy. We must assess whether current initiatives – such as the National AI Strategy Roadmap, the Trabaho Para sa Bayan Act and the Philippine Digital Workforce Competitiveness Act – are sufficient to address the changes shaping the labor market if they are actually implemented.

3. Promote stronger collaboration between the public and private sectors. Let’s develop relevant training programs, expand reskilling opportunities and identify areas for upskilling with the help of industry leaders, educational institutions and technology companies. This industry created millions of jobs and billions in revenue through the years. The least government can do is help the industry transition or become more competitive. TESDA and DOLE will be key players here. I know that TESDA Secretary Kiko Benitez shares these concerns and is already trying his best to plan for the future. We should support him in his efforts to upskill/reskill our workforce.

For now, just by understanding how artificial intelligence will reshape the labor market, we can adapt and adjust our strategies. We must not abandon our workforce. We must ensure they thrive so we can claim our place in this new digital era.