The BPO Industry in the Philippines 

The Philippines is globally known to providing Business Process Outsourcing (“BPO”) services to different business enterprises in the global market. The BPO is one of the fastest growing industry in the country which is also known to providing good-paying jobs to Filipinos. Its continuous exponential growth remains to be the best driving force for economic growth and recovery from the effects of the COVID-19 pandemic.  

Before the pandemic, almost all BPO companies occupy the Philippine Economic Zone Authority (“PEZA”) accredited buildings and office spaces in order to maximize the fiscal and non-fiscal incentives afforded to them by the government. However, the COVID-19 pandemic has caused radical changes in carrying out businesses around the globe. Companies were forced into remote work due to governments forcing work-from-home measures on a global scale to prevent the widespread infections from the COVID-19 virus.    

The BPO History in the Philippines 

Accordingly, it was Frank Holz from the Accenture group who started to form the first contact center in the Philippines in 1992. Seeing the success of the contact center, the congress in 1995 passed a law known as the Special Economic Zone Act which later one paved the way to the creation of the PEZA which provides fiscal and non-fiscal incentives to attract foreign investors.  

Fast forward in the early 2001, then President Gloria Macapagal Arroyo visited the United States where she attended an Information Technology Forum and signed atleast six Memoranda of Understanding (MOU). Thereafter, the BPO industry continues to grow and has even started to make an impact to the national economy contributing to the country’s gross domestic product (GDP). It continuously generated jobs and provided employment to the Filipinos, where majority were on a graveyard shift as majority of the clients served were coming from the United States. 

The support from government was also key to the industry’s continuous growth. Aside from the PEZA law, the government also passed into law the amendment of the Omnibus Investment Act to include Informations and Communications Technology (“ICT”) in the country’s investment priority plan. 

BPO Capital of the World

In 2010, the Philippines started to be known as the world’s BPO capital with at most 525,000 call center employees and $8.9B generated revenue. Over the years, the BPO industry continues to provide employment to millions of Filipinos and almost $40B in revenue in the close of 2022. It is also estimated that the Philippines’ BPO industry holds 10-15% of the global BPO market and majority of services are oriented in the United States, some European jurisdiction and Australia. 

Why the BPO in the Philippines? 

The Philippines has established itself to be a haven for outsourcing because of the following key attributes: 

  1. Government Support – the Philippine government has continuously shown support to this ever growing industry as can be seen by the establishment of the ecozones, fiscal and non-fiscal incentives in particular; 
  1. Large and high-quality talent pool – The Philippines has a very high rate of students graduating from college in different universities, colleges and state-owned colleges and universities throughout the country. This accounts to the benefit of the BPO industry as fresh graduates make a suitable labor-force who are very flexible in learning. 
  1. English Proficiency – Filipinos are also known to be proficient in the English language. Some learned the English language since grade school while others speak it since childhood. The same is important as majority of the clients served are from the English-speaking jurisdictions. 
  1. Cost-saving potentials – The outsourcing in the Philippines guarantees huge savings for corporations as the labor cost in the Philippines remains to be the most competitive in the ASEAN for both the professionals and middle-management levels. 
  1. Continuous growth – The growth and success which the industry has achieved over the past decades shows no sign of slowing down and experts predicts its continuous growth. To date, different BPO providers has invested in new technologies and continues to develop and enhance their capabilities to provide value-added services. 

Overall, outsourcing companies provide offshore business with the tailored-fit services they need to improve their operational efficiency and at the same time lowering the operational costs. 

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