The Outsourcing Week in Review: Wednesday, November 21, 2018

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Last week, the great and the good of the Philippines outsourcing industry gathered at the first two-day International Innovation Summit (IIS) 2018 in Manila. Hosted by the Information Technology and Business Process Association of the Philippines (IBPAP), the event was themed ‘Human + Tech: Philippines’ Capitalizing on Digital Disruption’, and was opened by an address from Senator Juan Edgardo Angara.

At the event, IBPAP chairman Lito Tayag warned that the industry has fallen short of its annual revenue and employment growth projections. Rey Untal IBPAP president said that IBPAP is on the lookout for a PHP40 billion ‘upskilling’ budget to help fast track the retraining that is needed to unlock industry growth. For outsourcing companies, developing a highly trained workforce will be essential to meet the demands of the future. According to Jobstreet, only 24% of employers are open to hiring K-12 graduates in the country. A recent report by Oxford University has also shown that the growth in the use of freelancer websites is enabling businesses to access workers directly in lower-wage countries, threatening to disintermediate traditional outsourcing company services.

The impact of uncertainty over tax reform has also acted as a brake on industry growth. Whereas most of the industry is supportive of a small rise in the gross income earned (GIE) tax rate of up to 7%, having to pay parts of it to both local and national governments is not popular, according to IBPAP research.  What is of paramount importance is to end the uncertainty soon. According to Contact Center Association of the Philippines president Jojo Uligan, BPO firms have postponed investment plans pending these final decisions on tax, and this has resulted in a decrease in the BPO sector’s growth rate.

At the IIS event, Outsource Accelerator’s Derek Gallimore joined a high-level plenary session along with Philippine Department of Trade and Industry Undersecretary Nora Kakilala Terrado and other high level speakers, to discuss “Creating a Culture of Innovation: Learning from Startups and Global Leaders”. Derek is also be speaking at leading fintech firm Payoneer’s upcoming forum in Taguig City on December 1. The forum will examine how to equip entrepreneurs with knowledge about industry trends, and to start and grow a business by expanding it to the global market.

Apart from these bottlenecks, the sector continues to look healthy. Demand for office space from BPOs and gaming firms is still driving the Manila office leasing market, according to Colliers. A report from Crystal Market Research-Technology says the KPO market is set to grow at a compound annual growth rate of 23.13% – or US$122.59 billion – by 2023. Joanna Wasiewska, the deputy head of Mission of the Embassy of the Republic of Poland in Manila, said that the number of Polish business process outsourcing (BPO) firms in the Philippines is growing. Following up rapidly after the tragic murder of a BPO worker in Cebu, the city government has acted on its word and added two new free shuttle bus services to take workers to the city’s IT Park in the early hours. Being safe getting to and from work is as of fundamental importance as being safe when at work.



Wednesday, November 21, 2018


19 November 2018

  • KPO market to generate US$103.7 billion by 2023 – read more…
  • Outsource Accelerator founder to speak at Manila forum – read more…
  • Conduent expected to post US$1.26 billion sales – read more…

16 November 2018

  • IT-BPM sector falls short of IBPAP employment, revenue targets – read more…
  • IT-BPM stakeholders wrap up IIS industry summit – read more…
  • Outsource Accelerator’s Derek Gallimore joins high level plenary session at IIS – read more…

15 November 2018

  • IT-BPM industry favors higher GIE, announced at IBPAP summit – read more…
  • NTC rejects appeals of disqualified 3rd telco bidders – read more…
  • Only 24% of employers open to hire K-12 graduates Jobstreet – read more…

14 November 2018

  • BPO, gaming firms spur office space demand – read more…
  • BPO firms put expansion plans on hold – read more…
  • IBPuAP on lookout for PHP40 billion ‘upskilling’ budget  – read more…

13 November 2018

  • Polish BPO firms thriving in Philippines – read more…
  • Cebu BPO workers get free bus rides – read more…
  • Online labor platforms alternative to traditional offshoring—Oxford study – read more…

Read more Inside Outsourcing Newsletters here:

  1. The Outsourcing Week in Review: November 14, 2018
  2. The Outsourcing Week in Review: December 5, 2018

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