The Outsourcing Week in Review: Wednesday, June 26, 2019
What were the top outsourcing stories for the week of June 26, 2019?
The week’s review centered on growing scrutiny of BPO working conditions, a still-booming Philippine economy competing fiercely for talent, and rapid diversification of the outsourcing and office-space sectors across the country’s regions.
- A report flagged dreadful working conditions for Facebook content moderators outsourced to Cognizant’s Tampa office.
- The BPO sector showed no signs of slowing, but other industries were also competing hard for talent as online recruitment rose 11%.
- Growth and diversification spread to Davao, Cebu, and Iloilo, with co-working space and new BPO facilities expanding.
Welcome to Inside Outsourcing: The Outsourcing Week in Review
THE WEEK IN REVIEW
Allegations last week in a report by The Verge on the dreadful working conditions for outsourced Facebook content moderators working at Cognizant’s Tampa office in Florida should be a deep cause of concern for both companies. Increasingly, companies worldwide are being called to account for work environments and practices that may be injurious to their employees’ long term health.
The Philippines is no exception. According to research by New Zealand’s Fonterra Cooperative Group about 60% of the labor force in the Philippines is aging prematurely. About 35% of 5,000 eighteen to 50-year-old employees working in the BPO sector in Metro Manila were also found to have low metabolism and bone mass during a health risk assessment. Whereas many local BPO outfits are commendably engaged in promoting healthy exercise among their workers, similar initiatives to improve diet may also merit consideration.
The battle for talent is only likely to grow fiercer. The BPO industry shows no sign of slowing says Kevin Tan, chief strategy officer at Megaworld, but neither does the rest of the economy. The country saw a balance of payment surplus for the seventh straight month in May, according to the Bangko Sentral ng Pilipinas, and growth over the next few years will remain strong across numerous sectors. BPO is no longer the only game in town looking for talent. Online recruitment is up 11% in the first quarter of this year according to Monster.com; and it is human resources, financial services, advertising, market research, public relations, media and entertainment, not BPO, that are leading the charge.
The office space sector is also diversifying to accommodate new sectors. The co-working space sector in Manila is expected to grow 10% annually, predicts Maricris Sarino-Joson, a director with Colliers; and it is the country’s young labor force that is driving demand, says Lars Wittig, country manager for Regus Philippines. KMC Savills announced that it is planning to expand its market share in multiple sectors including IT, finance, hospitality, and gaming, as well as BPO.
Diversification is also impacting the regions. Davao City’s real estate and ICT sectors are fuelling its growth, says the Davao City Investment and Promotion Center. American investor interest in Mindanao remains high despite a negative US travel advisory, said US ambassador Sung Kim. The Cebu Chamber of Commerce and Industry is establishing more provincial business chapters to develop convergence among the many business sectors that are growing in the province. Accounting outsourcing company TOA Global has just launched its latest facility at the Cebu IT Park, in Cebu City. Iloilo City’s re-elected mayor, Jerry Treñas, plans to make the city one of the country’s most livable cities, building on its success, not only at attracting BPO, but also food processing, retail and MICE business.
Meanwhile the Department of Trade and Industry is developing Regional Inclusive Innovation Centers across the country to aid developing artificial intelligence expertise. Globe Telecom has become the first local telecoms company to support the common tower project of the Department of Information and Communications Technology, as the country finally inches towards world class connectivity.
With all these sectors booming, it is surprising that a study by the Philippine Business for Education found that only 20% of the 70 leading firms in the country are keen on hiring senior high school graduates. Incorporating these new entrants successfully into the workforce will be essential to maintain the country’s broadening economic growth.
Wednesday, June 26, 2019
NEWS THIS WEEK
25 June 2019
- Cognizant’s Facebook content moderators allege appalling working conditions – read article…
24 June 2019
- TOA Global opens office in Cebu – read article…
- Real estate, ICT sectors drive Davao’s economic growth – DCIPC – read article…
- Online recruitment in Philippines rises by eleven percent – read article…
21 June 2019
- Manila co-working space to grow 10% p.a. – Colliers – read article…
- DTI says the Philippines is a potential AI hub – read article…
- Philippines maintains its balance of payments surplus in May – read article…
20 June 2019
- American investor interest in Mindanao not affected by travel advisory – read article…
- Globe is first telco firm to back DICT’s common tower initiative – read article…
- 60% of Filipino workers aging prematurely – read article…
19 June 2019
- BPO sector shows no signs of slowing down – read article…
- Senior high graduates have limited job opportunities – read article…
- CCCI plans to establish additional business chapters – read article…
18 June 2019
- Young workforce fuels co-working space demand in Philippines – read article…
- KMC Savills seen to expand in BPO, other sectors – read article…
- Mayor vows to make Iloilo one of the Philippines’ “most livable” cities – read article…
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Frequently asked questions
Why were Cognizant’s working conditions in the news?
A report by The Verge alleged dreadful working conditions for outsourced Facebook content moderators at Cognizant’s Tampa office in Florida, highlighting wider concerns about work environments that may harm employees’ long-term health.
Was the Philippine BPO industry slowing down in 2019?
No, the BPO industry showed no sign of slowing according to Megaworld’s Kevin Tan, though the rest of the economy was also growing strongly and competing for the same talent.
How was Philippine online recruitment performing?
Online recruitment was up 11% in the first quarter according to Monster.com, led by human resources, financial services, advertising, market research, public relations, and media and entertainment rather than BPO.
Which regions were diversifying their economies?
Davao City’s real estate and ICT sectors were fuelling its growth, Cebu attracted new facilities such as TOA Global’s office at Cebu IT Park, and Iloilo City aimed to become one of the country’s most livable cities.
Independent
