Proposed US laws could threaten BPO jobs in PH

FILE PHOTO (AFP photo)

LOS ANGELES – The Philippines’ booming business process outsourcing (BPO) sector – a key pillar of the country’s economy – faces renewed uncertainty as US lawmakers push measures to restrict the offshoring of customer service jobs.

If enacted, the proposals could threaten millions of Filipino jobs and raise costs for American consumers.

Two pending measures in Congress – the Keep Call Centers in America Act of 2025 and the Halting International Relocation of Employment (HIRE) Act of 2025 – aim to encourage companies to keep customer service operations within the United States.

Analysts warn the bills could make outsourcing less attractive for firms that have long relied on the Philippines for cost-efficient, English-speaking talent.

Keep Call Centers in America Act

Introduced in July 2025 by Senators Ruben Gallego (D-Ariz.) and Jim Justice (R-W.Va.), the Keep Call Centers in America Act would require the US Department of Labor to identify companies that offshore at least 30% of their call center jobs. Companies on the list would lose access to federal grants and guaranteed loans for five years.

The bill also mandates that agents outside the US disclose their location and the use of artificial intelligence (AI), while allowing customers to request a US-based representative.

According to the senators’ offices, call centers employ about 3 million customer service representatives nationwide, citing Bureau of Labor Statistics (BLS) data.

The BLS projects a loss of 150,000 US call center jobs by 2033 as companies continue to move operations offshore or automate customer interactions.

A Data for Progress survey found that 70% of Americans find automated phone systems more frustrating than speaking with live representatives.

“This bill will encourage companies to keep their call centers in the US and require that they tell you up front if you’re talking to an AI bot — protecting American jobs and making your day easier,” Sen. Gallego said. “If you’re calling customer service, chances are your day isn’t going great. On those frustrating days, you should be able to talk to a real human being right here in the US.”

Sen. Justice added, “West Virginians and all Americans deserve good service. When folks pick up the phone and ask for help, they shouldn’t have to deal with AI robots or be routed to someone across the world. This bill puts American workers first and ensures people can talk to a real person who understands them when they need help.”

The Communications Workers of America (CWA), representing thousands of call center workers, has endorsed the proposed legislation.

“This much-needed legislation protects US call center jobs and addresses the growing threats posed by artificial intelligence and offshoring,” said Dan Mauer, CWA’s director of government affairs. “Historically, companies have offshored customer service jobs to avoid paying good union wages and benefits. Now companies are using AI to de-skill and speed up work and displace jobs, which undermines worker rights and degrades service quality for consumers.”

HIRE Act of 2025

The HIRE Act of 2025, introduced by Senator Bernie Moreno (R-Ohio), would impose a 25% tax on payments to foreign workers providing services to US clients, with proceeds funding domestic job training and apprenticeship programs.

The Philippines is bracing for the impact of the two proposed US bills. The country’s BPO industry – projected to generate $40 billion in revenue this year and employ 1.9 million workers – remains one of its strongest economic drivers.

Industry groups warn that the proposals could weaken investor confidence and highlight the sector’s heavy reliance on American clients, who account for most outsourcing contracts.

Local firms are already moving toward higher-value services, such as data analytics, cybersecurity, and healthcare information management, according to the Information Technology and Business Process Association of the Philippines (IBPAP) and the Department of Trade and Industry (DTI).

Diplomatic steps

The Philippine government has taken diplomatic steps to address the issue. In October 2025, Ambassador to the United States Jose Manuel Romualdez said Manila is working with US lawmakers to seek exemptions for the Philippines.

He added that the government is encouraging US companies and business groups to advocate for less restrictive rules on established offshore operations.

On Oct. 20, 2025, the Philippine House of Representatives filed a resolution calling on the DTI and the Department of Foreign Affairs (DFA) to initiate consultations with US officials to protect the country’s BPO workforce.

Earlier, Trade Secretary Cristina Roque told the Philippine News Agency that the government stands ready to assist the sector amid protectionist headwinds. She emphasized the need for market diversification, saying the Philippines must look beyond US clients and expand into other regions. Roque added that she is open to meeting with IBPAP to develop strategies such as upskilling programs and the promotion of digital and knowledge-based services.

The Bangko Sentral ng Pilipinas (BSP) noted in its 2025 economic report that the country’s Information Technology and Business Process Management (IT-BPM) industry is accelerating its use of AI and automation to enhance productivity and maintain global competitiveness.

The report said firms are increasingly integrating robotic process automation and digital tools to transition toward higher-value services.

While the proposed US laws aim to bring customer service jobs back home, analysts warn that higher domestic labor costs could lead to increased service fees for American consumers. Outsourcing to countries like the Philippines has long allowed companies to provide round-the-clock support at affordable rates – an advantage that could diminish if offshoring is penalized.

Both bills remain under committee review, but their introduction underscores a broader trend toward economic nationalism in US policy.

For the Philippines, the challenge will be to adapt – through diplomacy, diversification and digital transformation – to sustain one of its most vital industries.

The post Proposed US laws could threaten BPO jobs in PH appeared first on INQUIRER.net USA.