As reported by Manila Bulletin, the BPO sector has acknowledged the looming impact that will be brought upon by technological innovations, particularly artificial intelligence (AI), automation, and robotics. In line with this, the Information Technology and Business Process Association of the Philippines (IBPAP) plans for the issue to become the topic of discussions at the upcoming 9th International IT-BPM Summit on November 7.
"Many experts are predicting that the workforce is in danger of being replaced by automation but that is simply not the case. What is often overlooked about automation is that while it is expected to impact certain jobs in the sector, this will also enable the IT-BPM Industry to move up the value chain, resulting in an increase in mid-skilled jobs and high skilled services," said IBPAP President Rey Untal.
Untal noted that international experts will attend the 9th International IT-BPM Summit to discuss comprehensively the impact of technology and the future of the BPO industry.
In Q2 of 2017, new investment pledges in the IT-BPM sector went down by 34% YoY, according to a data from the Philippine Statistics Authority (PSA). The data also reported that investment commitments in the BPO sector went down to R4.9 billion in Q2 from R6.27 billion.
In response to the issues surrounding the effects AI will have on the Filipino workers, Contact Center Association of the Philippines (CCAP) President Jojo Uligan said that efforts should focus on finding more opportunities for their workforce.
"Our success in this industry is our people. We have to make sure that we protect them, make them stay relevant, and educate them. Yes, the industry would feel certain impacts but what we are focusing on are the opportunities," said Uligan.
In August 2017, Colliers International released a report detailing the segments that will benefit from the government's "Build, Build, Build" infrastructure buildup program (or the BBB program). Based on the report, property development will be positively affected by the program, urging property developers and locators to take advantage of opportunities in expanding to provincial hubs.
According to Paul Vincent Ramirez, Valuations and Advisory Director of Colliers International Philippines, the BBB program is expected to contribute to the growth of the real-estate sector in the Philippines, particularly in the residential and office markets.
Ramirez said that "the planned infrastructure projects nationwide, if implemented, will unlock the potential in different areas across the country."
Furthermore, the positive outlook towards the BBB program is driven by continuous remittances from OFWs as well as the expanding BPO sector in the country.
"Residential take-up still continues to be strong and is keeping pace with the previous year. For the office market, BPO, gaming, and traditional office locators are the key drivers. While OFW remittances will still help prop up the residential sector."
BPO firms are one of the biggest office space tenants in Metro Manila, and the report from Colliers International suggests that these firms should consider expanding in the provinces. With this, we can also expect a boost in employment opportunities not just in the Philippine capital but in the provinces as well.
In addition to 75 flagship infrastructure projects identified earlier this year, the National Economic and Development Authority Board (NEDA) is planning to approve 18 additional flagship infrastructures before the year ends.
by: Sidney Liquigan
The Philippines and India are two of the leading countries, as well as top competitors when it comes to business process outsourcing (BPO). But rather than competing, we may be seeing these two BPO nations as outsourcing partners in the future.
That is according to the Department of Trade and Industry (DTI) in a report by GMA News last September 11. According to Trade Secretary Ramon M. Lopez, instead of competing with one another, the Philippines and India are looking for ways to complement each other's BPO sectors.
"In the area of BPOs, we agreed to work on hopefully improving complementation in serving our respective clients in areas of complementation instead of competing," Lopez said.
"We can probably jointly offer our respective services,” he added, saying that the respective areas of strengths of the Philippines and India should be combined and offered to clients.
The Philippines is a top call center outsourcing choice due to Filipino workers who are highly proficient in the English language and due to the Filipino culture's affinity to Western cultures. India, on the other hand, is a top location for European and US outsourcing firms and has the largest talent pool in the world in terms of technical skills.
Last August, JobStreet.com Philippines released the Cebu Jobs and Salary Report. In a media briefing, JobStreet.com Philippines Marketing Manager Eileen Camarillo-Go presented the report, which showed that BPO had the most number of job openings in Cebu.
Within the January-March 2017 period, there were 3,000 Cebu-based jobs listed in JobStreet.com, and 35% of them were BPO-related jobs. Further, BPO also had the most number of job listings across the whole country.
According to Camarillo-Go, the growth is expected to continue and that US President Donald Trump's statements against outsourcing "didn't reflect on the BPO jobs and we haven't felt any effect yet. When we talked to our partners in the BPO industry, we saw that it's not going to happen soon."
The JobStreet Cebu Jobs and Salary Report also identified that BPO jobs for fresh graduates accounted for 47%, in which outsourcing firms hire fresh grads for customer service, IT and software, and education specialist roles. Education specialists working in BPO and IT specialists from junior executive to supervisory levels are also the best-paid employees, according to the report.
The Department of Finance (DOF) said that the first package of the Philippine government's Comprehensive Tax Reform Program (CTRP) will not impact the BPO sector and that the sector will maintain its competitiveness in the export market.
Finance Undersecretary Karl Kendrick Chua said in a statement that the Tax Reform for Acceleration and Inclusion Act (TRAIN) or House Bill 5636, which is included in the first package of CTRP, seeks to remove the tax benefits enjoyed by "indirect exporters" – or suppliers of export-oriented firms and that there is no change in tax policy for exporters.
Chua clarified that under TRAIN, BPO firms, which are referred to as "eco zones" (special economic zones), will continue to retain their VAT exemptions and zero-rated status, while the ones outside, including Board of Investments (BOI)-registered firms, will retain their zero-rated status.
"Receipts from foreign services within the SEZs of the Philippine Economic Zone Authority will remain VAT-exempt, as is the case now, because they are outside customs territory by legal fiction, or zero-rated if the exporters are outside the special economic zone, including those that are BOI-registered," Chua said.
"As for exporters outside SEZs, they are zero-rated on VAT payments and are entitled to get back their VAT payments once they apply for such refunds under the proposed 90-day refund system, while all other taxpayers, including suppliers to exporters, will have to pay the VAT," he added.
Chua assured indirect exporters that their zero-rated VAT privilege will only be removed if and when an improved VAT refund system is in place, which will allow them to claim cash funds for VAT payments within 90 days of filing their VAT refund applications to the Bureau of Internal Revenue (BIR).
He maintains that the BPO sector will remain highly competitive and that the tax policy will remain the same after TRAIN.
"Demand services are driven by the high quality of service and talent they offer," Chua said.
US Ambassador to the Philippines Sung Kim assures that the US information technology-business process outsourcing (IT-BPO) companies based in the Philippines continue to maintain good business in the country.
This follows concerns on US President Donald Trump's plans on job policies, which can cause US outsourcing companies to defer their investments in the Philippines, as quoted from Philippine Economic Zone Authority (PEZA) Director General Charito Plaza in earlier news reports.
"We (in the Philippines) have a very young population, smart, very competent, and very hardworking. There's also a very strong cultural affinity so I think BPO will continue to do very well," said Kim, who made the statement during his first visit in Cebu recently for the general membership meeting of American Chamber of Commerce of the Philippines-Cebu Chapter held at the Cebu City Marriott Hotel.
The ambassador believes that much of the threats in the IT-BPO sector come in the form of automation, which replaces human workers, leading to job loss.
This is further affirmed by the International Labor Organization (ILO) report, which notes that majority of 89% of BPO employees are at "high risk" from robotic process automation.
Kim validated that Filipinos continue to be the preferred workers for US IT-BPO firms, which currently hires 1.3 million Filipino workers.
The economic partnership between the US and the Philippines is maintained, despite setbacks in 2016.
"We want to assure you that the United States will continue to partner with the Philippines and look for ways to increase foreign investment, reduce trade barriers, and streamline business regulations," he said.
More companies are turning online for their recruitment, as evidenced by a 12% increase between May 2016 and 2017 in the latest results of Monster Employment Index (MEI), a monthly gauge of online job-posting activity, based on a real-time review of millions of employer-job opportunity data from career websites and online job listings nationwide.
Monster.com managing director for Asia Pacific and Middle East Sanjay Modi said that the Philippines is set to gain sustainable-employment growth in the year ahead. This is due to a highly stable macro economic environment supported by strong economic structures.
"This is evident from the latest BMI research results which said the Philippines’s business friendliness has made it favorable for investments, production activities and job creation," he said.
"In line with our MEI findings, the Philippine Statistic Authority’s latest data showed the unemployment rate has fallen when compared to the corresponding period from last year," he added.
The MEI results showed the fifth positive annual growth for the country since January of this year, with 106 total job listings last compared, which is higher than the recorded 95 in May last year.
Web-based recruitment continues to enjoy an upward trend, with the internet technology (IT) and business process outsourcing (BPO) services industry gaining the strongest growth in online hiring.
There was a 30% increase in May 2017, with 138 employments were placed online compared to the 106 posted during the same period in 2016. This is considered as the highest growth industry year-on-year (YoY) increase in web recruitment in May.
According to the MEI's monitored occupation groups, customer-service talents are the most in-demand and most hired, at a 40% YoY growth in May this year from 107 to 150. It was a 10-percent increase from the 30% YoY growth in April of the same year.
It is followed by software, hardware, and telecom, from 106 to 117. Hospitality and travel, healthcare, engineering, real estate, and human resources and administration are recorded to have less occupational demands.
The BPO sector currently employs 1.2 million people and is anticipated to grow to 1.8 million within the next five years, as stated in the Information Technology-Business Process Association of the Philippines Roadmap 2022 report.
The second strongest sectors are logistics, freight, transportation, courier, shipping, import, and export, with an increase of 17% from 108 to 126.
Education has the lowest growth, with negative 3%, from 113 to 110.
On the other hand, the engineering and real-estate sector has a 6-percent decline from 88 to 83 YoY in online hiring in May.
"Being a shining spot in Asia’s economy, it is likely the country has come under the scrutiny of international players who can potentially and rapidly introduce new jobs in a short span of time. Even then, therein lies a need for business owners and employers alike to remain cautious and to always have sufficient plans to cushion potential headwinds," Modi said.