Robots in the workplace? What 2024 holds in store for business services in Czechia

There are a lot of myths doing the rounds when it comes to the impact of technological transformation on working life. Speculation about what the future holds for Czech workplaces is no surprise given the rapid pace of technological change and increasing power of digital solutions.

A new report issued by the Association of Business Service Leaders of the Czech Republic (ABSL) has examined what 2024 holds in store for tech transformation in Czech business. The results may be a surprise, showing that increased automation and digital technology adoption will be accompanied by an increase in total employees in the business services sector.

ABSL’s findings suggest that the negative hype around the potential for automation to make workers redundant is unfounded. Indeed, the business services industry faces the opposite problem: a lack of qualified workers to fill an expected 15,000 new jobs.

The boom in technological developments is driving impressive growth for the business services sector. According to ABSL, 80 percent of companies in the IT and business services industry plan to extend their automation projects to other processes and services in the coming year, with work performed by robots already holding the equivalent of nearly 20,000 full-time roles.

For many, the chief motivations are driving down costs on a global scale by leveraging the deep tech talent pool available in the Czech labor market.

86 percent of companies are planning to accelerate their digital transformation, with cyber and information security services, IT support, and data analytics the fastest growing areas of business and IT services in Czechia. There are already around 380 IT and business service centers in the country, demonstrating Czechia’s status as an international leader in the field.

“The fact that centers in the Czech Republic are developing and deploying advanced technologies, which are then used by the world’s major global companies, helps the Czech Republic to maintain its strong and stable position among the countries that are in the crosshairs of international companies as a suitable destination for establishing and operating an innovation or service center, despite the higher costs here,” says Jonathan Appleton, Managing Director of ABSL.

In this context, Czechia is only set to become an even more important location for worldwide business service operations. Booming demand for specialists confirms this, with ABSL’s research suggesting that 15,000 new workers will be recruited into the sector in 2024.

"According to our survey, 59 percent of Czech business and IT service centers plan to expand and grow in the coming period. We therefore expect 15,000 new jobs to be created in the sector this year alone, across the whole of the Czech Republic, especially in dynamic locations such as Brno, Liberec, Hradec Králové and České Budějovice," Appleton explains.

"These will be innovative, digital and global, high value-added positions that make a significant contribution to the country's vision as a digital and innovative leader in global business," he adds.

In the context of increased automation, it’s clear that artificial intelligence will continue to be a hot topic in 2024. According to ABSL, business centers which are already making use of AI are growing twice as fast as the industry average. 39 percent of centers believe innovation in AI will fundamentally transform their working practices.

Uncertainty around the eventual impact of AI is linked to a fundamental need to better understand and harness the potential of the technology, including recognition that it is not fail-safe. Human experts using this powerful tool, according to ABSL, have the potential to effect transformative change for the entire business services industry, which is reflected in demand for AI-specific roles and specialists in AI functions.

In the context of a boom in business services employment, questions are being asked about Czechia’s ability to supply the required number of workers. Put simply: there are not enough skilled professionals in Czechia at present to provide the roughly 15,000 new workers needed by the sector.

This imposes requirements on businesses to nurture and upskill employees, while also seeking more workers from abroad.

“The data from our report shows that local employers are able to attract, engage and retain skilled people despite the labor market situation,” explains Appleton.

“Forty percent of the workforce is made up of expats from virtually all over the world, giving the industry an attractive and inspiring international vibe; salaries for some leadership and technology roles are in the 6 figure range and grew by an average of 6.5 percent last year. The average retention of employees in the industry is steadily increasing year-on-year," he adds.

With demand for foreign employees set to grow, ABSL notes that simplification of recruitment from abroad and a more flexible migration strategy would be welcomed by business service employers. Countries providing rich potential to bolster the Czech labor force, according to ABSL, include India, South American nations such as Brazil and Colombia, the Philippines, Balkan states such as Serbia and Albania, and Turkey.

ABSL’s research shows that profound change resulting from digital transformation creates sky-high potential for the Czech business services sector. Companies, however, need to dig deep, as only through attracting increasing numbers of skilled workers from Czechia and abroad will they be able to realize new opportunities.