Now employing more than 1.2 million people, and recently overtook India as the world’s leading BPO destination, it is undeniable that the business process outsourcing (BPO) industry in the Philippines is gaining a good momentum in its growth. Aside from Metro Manila, which is the top BPO destinations in the archipelago, new wave of cities are now starting to emerge.
Cebu and Davao are both on top of this list. The two major cities from the second and third largest island groups of the country have been slowly and steadily growing their fair share of contact centers and outsourcing companies for the past few years. Up north, progressive cities of Ilocos have also been eyed. Puerto Princesa and Negros are also within the radar of foreign contact center investors. These cities were identified by the Department of Science and Technology-Information and Communications Technology Office (DOST-ICT Office), Information Technology and Business Process Association of the Philippines (IBPAP) and Leechiu Property Consultants (LPC).
But how will these so called “new wave cities” affect our BPO industry?
Latest forecast suggests that the BPO industry is expected to get a revenue of $25 billion this year, or an increase of 13% from last year’s $22 billion. Should this current growth rate continues, the Banko Sentral ng Pilipinas (BSP) predicted that the BPO industry will overtake OFW remittance by 2017.
With this trend, we can expect that more Filipinos will be encouraged not to leave the country to look for quality jobs. Moreover, the total global opportunity for outsourced IT-business process management was expected to grow to $250 billion by 2022 according to Trade Secretary Ramon Lopez.
Although Metro Manila is the center of the BPO industry in the country, these “new wave cities” offer cheaper overheads which are very attractive to both established and start-up outsourcing companies. The increasing number of BPO companies all over the country means that opportunities are spread out throughout the archipelago, diffusing focus on populated Manila.
But in order to maintain this growth, the industry needs ample government support. Fortunately, the government is doing its best to support this emerging industry. For instance, the Training for Work Scholarship Program is one of their initiative to provide enough pool of talented workforce for the industry.
Another government initiative that benefits the BPO industry is the partnership between the Commission on Higher Education and industry association which gave birth to the Service Management Program. A program that specializes track for business and IT schools with the aim to develop strong manpower for the BPO industry, this initiative ensures that there would be enough talent pools ready to be hired by companies that wish to outsource to the Philippines.
Even the continuous effort of the government to improve the internet connectivity in the country is starting to bear fruit. According to a telephone interview with The Philippine Star to NTC deputy commissioner Edgardo Cabarios, the Philippines is able to show progress in internet connectivity as it ranked 11th in terms of average download speed and upload speed globally this 2016.
The data he cited came from an internet metrics provider Ookla, which is also consistent based on the other reports showing that the Philippines is making gains in its internet speed.
With the emergence of the “new wave cities”, we’ll be expecting an impressive growth in our BPO industry. Likewise, this trend will be a win-win situation for both parties since foreign companies will benefit from the lower cost of doing business outside the capital and it will continue to bring more opportunities and investments to the country.
Philippine Daily Inquirer (26 Sept 2016). ‘New Wave Cities’. Retrieved from http://opinion.inquirer.net/97671/next-wave-cities.
Newsbytes Philippines (4 April 2016). 10 ‘Next Wave Cities’ picked as BPO hotspots; emerging cities also named. Retrieved from http://newsbytes.ph/2016/04/04/10-next-wave-cities-picked-as-bpo-hotspots-emerging-cities-also-named/.
Outbounders TV (2015). BPO locations moving from Metro Manila to the province. Retrieved from http://www.outbounders.tv/bpo-locations-moving-metro-province/.
Desiderio, Louella (7 Sept 2016). Philippines marks gains in internet metrics. Retrieved from http://www.philstar.com/business/2016/09/07/1621070/philippines-marks-gains-internet-metrics.