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Outsourcing News for April 2012 | MicroSourcing

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According to the Business Processing Association of the Philippines (BPAP), the IT outsourcing segment posted a 37% increase in revenues last year, reaching $993 million. The entire outsourcing industry, on the other hand, only grew 24% at $11 billion. The BPAP statement shows that for 2012, more IT deals could be awarded due to the growing demand. The IT outsourcing sector also employed 49,908 IT professionals in 2011.

Growth in the BPO sector

Meanwhile, new processes such as knowledge process outsourcing (KPO) posted a 24% increase in revenues at $2 million. Furthermore, the non-voice segment employed nearly 130,000 candidates last year.

With the Philippines already established as a call center hub, a strong 21% growth rate was seen last year for the industry at $7.4 billion, getting the lion’s share (65%) of the entire BPO sector.

Another growing segment is game development which grew 13%, contributed $8 million, and employed 1,400 workers. For animation, the BPAP statement said a slight drop in contracts was seen last year as competition in back-room animation gets tougher. It posted $128 million in revenues with a workforce of 8,600 in 2011. For the healthcare information management outsourcing, the first survey done by BPAP showed that the segment employed 24,700 and contributed $277 million.



100,000 Jobs Up for Grabs on May 1

by: Sarah Joson

Wednesday, April 25, 2012 | Outsourcing News | Comments (0)

BPO industry to participate in Job and Livelihood Fair

The Department of Labor and Employment (DOLE) will be holding a Job and Livelihood Fair on May 1, Labor Day, at the World Trade Center in Pasay City.

DOLE Secretary Rosalinda Dimapilis-Baldoz noted that the fair is in line with President Aquino’s 16-point Social Contract with the Filipino People. The fair aims to give unemployed Filipinos an opportunity to land a job, and income opportunities for aspiring entrepreneurs.

About 200 companies from industries such as business process outsourcing (BPO), tourism, banking and finance, hotel and restaurant, health and wellness, and construction are expected to participate in the event.  Moreover, 75 land-based and 25 sea-based agencies will take part in the job fair to cater to those who are looking for opportunities abroad.

Job fairs will also be held in other regions in the country on the same day, said Baldoz.

According to the Philippine Information Agency (PIA), DOLE Region 10 will conduct job fairs in Misamis Oriental and Cagayan de Oro. DOLE Region 11, on the other hand, is set to offer 12,424 job openings in Davao to give opportunities for over 18,000 graduates.


The latest report from the Asian Development Bank states that in order for the Philippines to maximize economic growth potential, the government should look into manufacturing and not business process outsourcing (BPO).

Volume of jobs created by BPO segment not sufficient

Norio Usui, ADB’s senior country economist and author of the report “Taking the Right Road to Inclusive Growth,” said the volume of jobs created by the BPO segment is not sufficient, as it only accounts for 1 percent of the country’s entire labor force and is favourable only for college graduates.  He adds that for a more comprehensive growth in different areas of the country’s economy, the manufacturing sector should be developed more.

The study likewise highlighted that strategies and plans for the industrial sector should be reinforced, and employment opportunities should be provided for undergrads as well.

Moreover, Usui stated that among the countries in Asia, the Philippines is the only one that has a declining industrial base. In fact, the sector’s contributions to the country’s GDP dropped from 39 percent in 1980 to 32 percent in 2009.

Meanwhile, Kunio Senga, ADB’s director-general for Southeast Asia, said that even with the bullish growth posted by the services sector, issues regarding poverty and unemployment still plague the country.

The ADB believes that in order for the country to recover from poverty, more export products should be developed and the business environment should be made more attractive for investors.


According to a research done by renowned outsourcing consultancy firm TPI, large IT contracts this year are anticipated to come from emerging markets and not on mature ones like the US and Europe.

Global companies compete for new IT deals

Managing director and partner at TPI, Sid Pai, said even if India will benefit from the trend, it is unlikely that it will resound to local software providers. Global companies operating in India like IBM or Accenture are also competing for these deals.

Moreover, MindTree CFO Rostow Ravanan predicts contract renewals this year will reach 300. Ravanan also believes that even if small and large players are up in arms in gaining IT deals, Indian players will be able to win at least 80% of the contracts. The game changer he says would be the price points of global versus local players. On the other hand, an analyst predicts that HCL will land most of the IT deals since the firm is willing to change its price points.



US Anti-outsourcing Bill Gains Supporters

by: Sarah Joson

Wednesday, April 18, 2012 | Outsourcing News | Comments (0)

US Law to Penalize Firms that are Outsourcing

According to The Indian Express, the Call Centre and Consumer Protection Act now has a total of 106 lawmakers who are the bill’s co-sponsors.

The anti-outsourcing bill authored by Congressman Tim Bishop aims to monitor US firms that outsource call center work to offshore locations and keep them from getting federal grants and loans. Bishop hopes that the recent increase in the number of the bill’s supporters will push the Committee on Energy and Commerce to hold a hearing on the legislation.  

Bishop noted that the law is specifically for firms which are taking advantage of local taxpayers by taking millions of allotted incentives for the local communities. Aside from keeping US firms with offshore operations to get grants, the act, if signed into a law, will also require call center agents to inform callers in the US their location and give them the option to be transferred to a local agent.



PH BPO Posts 24% Growth in 2011

by: Sarah Joson

Friday, April 13, 2012 | Outsourcing News | Comments (0)

Bullish Philippine BPO Industry is on Track

The business process outsourcing (BPO) sector of the Philippines is right on track when it comes to meeting its 2016 goals as it posted a 24% ($11 billion) increase in revenues from 2010 to 2011.

Benedict Hernandez, President and CEO of the Business Processing Association of the Philippines (BPAP), said the figures posted by the sector last year were higher compared to the 20% yearly projection, and bested the 10% to 15% predicted global figures. A 22% increase in jobs was also seen last year, with a total of 638,000.
For the five-year target, Hernandez said the industry is eyeing to reach $25 billion or 9% of the country’s GDP. Meanwhile, the BPO sector’s largest segment, call center operations, contributed 65% of the industry’s total revenues and grew 21% in 2011.

According to Hernandez, one of the key growth drivers for the segment is the strong support from the local government, specifically the P450 million budget for BPO-specific training programs by the Technical Education and Skills Development Authority (TESDA), as well as the support from the Department of Science and Technology (DOST) and Commission on Higher Education.


The National Economic and Development Authority (NEDA) said the business process outsourcing (BPO) sector of the Philippines can attain an annual growth rate of 15 percent from 2011 to 2016. With this growth forecast, the Business Processing Association of the Philippines (BPAP) said the sector will be able to create more than three million direct and indirect jobs.

Predicted growth for the BPO sector

According to Ruperto Majuca, Assistant Director General at NEDA, 15 percent is the closest annual growth projection for the BPO sector from 2011 to 2016, although it could also reach 20 percent if public and private partnerships are reinforced, or fall to nine percent if the global market weakens.

During a meeting with President Benigno Aquino III last week, Majuca said the economic crisis in Europe and the US’ delayed recovery from recession will not affect the predicted growth of the global BPO market. He added that those types of economic challenges push foreign companies to outsource work to countries such as the Philippines with relatively lower labor and operational costs.

NEDA said faster establishment of the so-called Next-Wave cities, improving the quality and quantity of talent pool, and further enhancing the business environment to make it more attractive for offshoring are efforts that should be made to maximize the growth potential of the BPO sector.


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