The Philippine government is doubling down on future-proofing its workforce, with President Ferdinand Marcos Jr. approving a wide-scale upskilling programme designed to train up to 340,000 workers in the business process outsourcing (BPO) and IT-business process management (IT-BPM) sectors annually.

The move signals the administration’s commitment to keeping the country’s largest employment sector competitive as artificial intelligence continues to disrupt traditional work models.

A hedge against AI disruption

At a recent meeting with the Private Sector Advisory Council (PSAC)’s Digital Infrastructure Sector at Malacañang, President Marcos greenlit budget allocations to upskill BPO workers, college students, and near-hire individuals – those just on the cusp of employment. The initiative is a direct response to a sobering report by the International Monetary Fund, which estimates that up to 14% of the Philippine workforce is at risk of being displaced by AI.

The BPO industry – one of the country’s largest employment engines with 1.3 million full-time workers – is at the epicentre of this transformation. Myla Villanueva, PSAC Digital Infrastructure lead and Chairperson of MDI Group Holdings Inc, underscored the urgency of skilling up for AI-augmented roles.

“We’re preparing for the inevitable, not the improbable,” she said. “This budget is about preparing our people for the new shape of work.”

Backing this effort is a government commitment of 740 million pesos, which will fuel large-scale training beginning in the second half of 2025. According to the IT Business Process Association of the Philippines (IBPAP), this funding contributes to a three-year goal of producing 340,000 digitally adept scholars.

The association is aligning its programme strategy with the Technical Education and Skills Development Authority (TESDA) and the Department of Information and Communications Technology (DICT).

From red tape to real-time: The case for digital government

The upskilling drive is part of a broader digital transformation agenda championed by PSAC. The council is pushing for what it calls a “Government as a Service” model – essentially a smartphone-like platform that integrates multiple government functions.

Think of it as an app store for public services: one gateway through which Filipinos can access permits, pay taxes, and retrieve documents.

PSAC has called on DICT to fast-track the deployment of the eGovDX and eGovPay systems, while encouraging private-sector developers to co-create solutions through open-data collaboration. The potential payoff is a faster, leaner, and more responsive bureaucracy.

Yet this vision faces a sizeable stumbling block: cybersecurity. As digital infrastructure expands, so too does the attack surface. PSAC is lobbying for the speedy passage of the Cybersecurity Bill in Congress and recommending immediate stop-gap measures such as vulnerability audits and skills training. The goal is to close the cybersecurity talent gap by 2025 – a deadline that is fast approaching.

Philippines opens doors to global talent with digital nomad visas

In a move aimed at positioning the Philippines as a regional hub for remote work, President Marcos has issued Executive Order 86, authorising the issuance of digital nomad visas (DNVs). Signed by Executive Secretary Lucas Bersamin, the order allows qualified foreign nationals to live and work remotely in the country for up to one year, provided their employers or clients are based overseas.

The Department of Foreign Affairs will maintain a database of DNV holders to ensure accountability and enable effective monitoring. This policy forms part of a larger strategy to diversify the economy by attracting global knowledge workers, freelancers, and digital entrepreneurs who can inject new skills and spending into local communities.

As Sabin Aboitiz of PSAC aptly put it, “These initiatives are not just for tech experts – they are for all Filipinos.” Whether it’s through boosting the capabilities of local workers or inviting global digital talent, the aim is to build a more agile and inclusive economy.

Poised for progress, but not without pitfalls

These developments come at a crucial inflection point for the Philippine economy. The IBPAP forecasts the IT-BPM sector could breach the US$40 billion revenue mark by 2025, with a projected 2 million full-time employees within 12 to 18 months. But sustaining this growth demands more than optimism – it calls for action across multiple fronts: skills, systems, security, and services.

In business parlance, the Philippines is betting on a dual strategy – upskilling locals while onboarding digital expats. It’s a bold play that recognises both the promise and peril of automation. As the world transitions from muscle to machine, and from cubicles to cloud-based work, the nation is laying down the digital rails for an economy that doesn’t just catch up, but leads.

There will be hurdles in implementation, gaps in coordination, and resistance to change. But with clear-eyed policies and collaborative execution, the Philippines could turn disruption into dividends – transforming risk into resilience and talent into treasure.