BPO workers and founders must pivot as sector contracts, says BOJ governor

Business process outsourcing (BPO) workers and founders must pivot as artificial intelligence (AI) cuts the industry’s need for workers, Bank of Jamaica (BOJ) Governor Dr Brian Langrin said on Friday.

It comes as more than one million square feet of BPO-oriented space sits on the market and the sector sheds jobs.

Langrin spoke on the sidelines of a Jamaica Chamber of Commerce breakfast at The Jamaica Pegasus hotel, in response to a question from the Financial Gleaner. His formal presentation dealt with digital payments and JAM-DEX.

He described the sector as labour-intensive and susceptible to AI disruption.

“It has to be the entrepreneurs that pivot,” he said, adding that they must watch for new opportunities. He expects workers to retrain and find other work, thereby avoiding a net fall in jobs throughout the economy.

Employment in the sector has fallen by about a third over two years to roughly 40,000, from 60,000, according to the Global Services Association of Jamaica (GSAJ). The losses have begun to register in national job numbers, though unemployment remains near record lows.

“I don’t think there’s been widespread loss of employment ... only if people don’t think about what next,” Langrin said.

The July labour force survey from the Statistical Institute of Jamaica showed overall employment down 21,800 and formal employment down about 24,000, while unemployment edged up to 3.4 per cent.

Langrin acknowledged that disruption will follow, but compared the shift to earlier technological upheavals that ended with more jobs than before, citing the arrival of the motor vehicle and the Internet.

Industry doesn’t blame AI

The industry itself does not blame AI. GSAJ president Yoni Epstein cited low productivity, disruption from Hurricane Melissa, and a shortage of available talent. Outgoing president Wayne Sinclair said many of the lost jobs sat with top-tier global companies that moved the work to jurisdictions offering stronger incentives.

Asked what the contraction means for investors who built BPO centres and the banks that financed them, Langrin spoke only about jobs.

The Gleaner reported in August that more than 245,000 square feet of BPO-oriented office space stood vacant, above usual inventory. A Gleaner analysis of MLS real estate listings now counts upwards of one million square feet on the market. That figure covers space listed for sale or lease, including space under contract that has not closed.

Langrin used his presentation to urge businesses not to treat today’s inflation as permanent when setting tomorrow’s contracts. He expects inflation to return to target by mid-2027, subject to geopolitical and supply developments.

Annual inflation reached 8.6 per cent in September, above the central bank’s 4.0 to 6.0 per cent target range. The BOJ raised its policy rate by 50 basis points to 6.0 per cent effective September 29. Langrin expects growth to strengthen in the 2027/28 fiscal year as constraints in agriculture, tourism and mining ease and reconstruction gathers pace.

carolyn.guniss@rjrgleaner.com