Key Economic Milestones of Philippine Business Process Outsourcing
The Philippine Business Process Outsourcing Industry began to flourish as early as 1992. Owing much to both globalization and the country’s government support, the Philippine business process outsourcing industry has continued to contribute to the economy of the Philippines and its people.
The following are key economic milestones that helped pave way to the robust Philippine business process outsourcing industry that we have come to know today.
1995
The 1995 Special Economic Zone Act was passed in the Philippine Congress to promote investments in both the the export-oriented manufacturing and services sectors inside special economic zones, particularly to the growing Philippine BPO industry. Under the 1995 Special Economic Zone Act, foreign companies are eligible to countless tax incentives, grants and privileges.
This law has helped pave way to Philippine Special Economic Zone Authority (PEZA) registered enterprises that have reportedly provided 1,017,559 jobs to nationwide with exports amounting to USD 15.797 billion (as of 2019).
2000-2020: Two Decades of Economic Growth
The contribution of the Philippine Busines Process Outsourcing has been growing steadily over the past few years.
In a report by the Oxford Business Group, according to the IT and Business Process Management (IT-BPM) Roadmap for 2012-16 published by the industry group IT and BPO Association of the Philippines (IBPAP), Philippine Busines Process Outsourcing accounted for just 0.075% of GDP in 2000, rising swiftly to reach 2.4% in 2005, 4.9% in 2011, and 5.4% in 2012. Its estimated GDP contribution was 6% in 2015, with expectations that it could contribute up to 9% of GDP in 2016.
A 2019 report from the World Trade Organization (WTO) states that the Philippine business process outsourcing industry accounts for a 7.3% contribution to the growth in GDP.
According to the IT and Business Process Association of the Philippines (IBPAP), the number of full-time employees (FTEs) of the sector in the country increased by 23,000 in 2020, increasing the total industry headcount to 1.32 million.
The Road Ahead
The Philippine Business Process Outsourcing industry highly contributes to foreign direct investment net inflows in the country. In fact, it is only second to remittances from Overseas Filipino workers (OFWs).
Moving forward, the Philippine Business Process Outsourcing Industry is expected a continual growth in the country.
The IBPAP’s revised targets for 2022, projects the headcount growth at around 1.37 million to 1.43 million full-time employees, or 2.7% to 5%, and industry revenues of $29.09 billion with a compound annual growth rate of 3.2% to 5.5% in the next two years.
Connext Global Solutions provides Quality Business Process Outsourcing Solutions
Connext Global Solutions is a renowned Philippine outsourcing provider that builds industry best business process outsourcing solutions through its commitment to management philosophy and leadership development at all levels.
Connext Global Solutions handles business process outsourcing talent acquisition, management, and training for you. The company actively sources offshore talent required by the client. Comprehensive assessments, screening, testing, and interviewing are conducted by Connext, ensuring the client the highest level of talent from the pool.
Lessen overhead since we handle the people, facilities, rent, utilities, compliance and systems while allowing the client to own what is most important and unique to your business and unlock business growth.
Partner with Connext and receive:
- Geographically diverse talent
- 100% virtual recruitment and employment process
- Productivity, utilization, and quality monitoring
- Dedicated account management
- Standing IT support
- Talent management and employee engagement
Connext redefines business process outsourcing to the Philippines by providing fully customized outsourcing solutions for organizations looking to innovate and grow. Build your Philippine outsourcing workforce with Connext Global Solutions today.
Deepen your understanding of the Philippine BPO industry. Explore our blog post what are the business processes outsourced from the Philippines to see how these services have shaped key economic milestones in the sector.
