AI will shift office demand from back offices to office laboratories: JLL

Artificial intelligence will trigger a realignment in office space allocation in the Philippines, favouring specialised office laboratories over traditional back offices, according to JLL Philippines. Workers in routine roles such as call centre agents are expected to transition into tech-testing jo

ARTIFICIAL INTELLIGENCE will trigger a realignment in office space allocation in favour of specialised “office laboratories” instead of traditional back offices, Jones Lang LaSalle (JLL) Philippines has said.

In an interview, JLL Philippines Country Head Joey Radovan said that while AI will automate routine back-office tasks, workers are likely to transition into tech-testing roles, redirecting real estate absorption toward hybrid facilities equipped for heavy hardware and quality control.

According to JLL, AI affects labour through three mechanisms: role augmentation, selective displacement, and job creation. While displacement focuses on automating routine tasks, job creation is driven by efficiency gains that unlock new market demand. “Role augmentation could be due to existing roles. For example, the call centre agent might need to do more sophisticated work related to AI,” Mr Radovan said.

Rather than resulting in net job losses for the information technology-business process management industry, the integration of AI is expected to create a trajectory of high offsetting disruption due to workforce restructuring and geographic relocation. “Instead of being call centre agents, they’ll be part of an assembly line to look at, for example, the quality of chips. The office space might become an office laboratory, which is a different type of office. So they won’t get fired, but all of them will be doing a different type of work,” Mr Radovan said.

An office laboratory can be a combination of an industrial facility with office space inside it, and the floor loading might be more structurally demanding because equipment is brought in for testing. Demand for such space is closely linked to expanding industrial and logistics initiatives, such as the Luzon Economic Corridor and the US-led Pax Silica initiative, which are attracting semiconductor manufacturers and hardware testing suppliers to the Philippines. “The Philippines has made a bet by driving a new type of requirement in the form of this industrial and logistics fee… It’s attracting new types of firms, the names that you probably have never heard of, because they’re not companies that are banks or IT firms. They’re actually the semiconductor and related industry firms,” Mr Radovan said.

Aside from transitioning to specialised testing spaces, corporate real estate managers are optimising traditional office footprints based on actual seat utilisation data. “If the utilisation is only 50%, why would you still lease new space or renew like 1,000 square metres if you only need 500 sq.m.? So that’s really the kind of practical indicator in terms of the space requirement,” Mr Radovan said, noting that future absorption will depend on corporate investments in employee upskilling and retraining.