Africa’s business process outsourcing (BPO) industry is poised for exponential growth, predicted to double by 2030, according to a report by CCI Global, a customer service management firm, and the research firm Everest Group.
This expansion is driven by the increasing demand from global companies seeking outsourced customer service solutions.
Significant job creation and economic benefits
The report forecasts that 1.5 million new BPO jobs will be created in Africa over the next six years. South Africa, Kenya, and Egypt are set to be the primary beneficiaries, while emerging hubs like Ghana, Ethiopia, and Rwanda are also positioned for substantial growth.
This surge is fueled by Africa’s cost advantages, with labor costs up to 80% lower than in Western markets.
Also, nearly 45% of companies surveyed noted that African governments are fostering a business-friendly environment through tax breaks, infrastructure development, and workforce training programs.
The continent’s young, multilingual population further enhances its appeal as a prime outsourcing destination.
Opportunities and challenges ahead
Martin Roe, CEO of CCI Global, suggests that the rapid growth of the Business Process Outsourcing (BPO) sector in Africa is partially driven by the region’s high youth unemployment rates.
In an interview with African Business, Roe stated, “Our view as a company is that talent is actually quite well distributed globally, but opportunities are not, and unfortunately in many African countries highly educated and motivated young people can’t get a job.”
Roe also highlighted the importance of language skills in the BPO industry, noting that it’s not just about speaking English, but understanding its nuances, such as sarcasm and irony, to connect with customers effectively.
He sees a “huge opportunity” for Africa to become a major player in the global BPO market, emphasizing the need for adequate preparation to maximize the expected investment wave.
Governments across Africa increasingly recognize the BPO sector’s potential for rapid job creation, which Roe argues is crucial given the limited sectors capable of creating jobs as quickly. However, he acknowledges that challenges remain, including unreliable infrastructure and currency instability.
Kenya’s large and increasingly tech-savvy youth population provides a rich talent pool for BPO companies. This, coupled with the government’s commitment to enhancing ICT infrastructure and fostering the digital economy, significantly boosts the sector’s growth potential.
However, to fully harness these opportunities, ongoing skills development, robust cybersecurity measures, and continuous infrastructure upgrades are crucial.
