Philippine IT-BPO Industry Grew 26% and Added 100,000 New Jobs

(Manila, Philippines, April 6, 2011)—The Business Processing Association of the Philippines (BPAP) and its partner associations ACPI, GDAP, HIMOAP, and PSIA, together with the Contact Center Association of the Philippines (CCAP), reported that the Philippine information technology and business process outsourcing (IT-BPO) industry grew 26% in 2010 to US$8.9 billion. The industry employed a total of 525,000 skilled workers and professionals by the end of 2010, recording 24% employment growth from end-2009.

BPAP Chairman Alfredo Ayala highlighted data showing that the industry not only grew but also diversified. “We achieved robust growth in all major sectors of the industry: voice-based BPO, non-voice business support and complex services, and information technology. Our contact-center sector grew over 20% in 2010, overtaking India and establishing itself as the largest in the world on the back of the Philippines being recognized as the most-preferred destination in the world for these services.

“The numbers also show that our non-voice BPO sector, including back- and mid-office business support and high-value knowledge process outsourcing (KPO), grew fastest at an impressive rate of 30% in 2010. We now employ more than 100,000 professionals in this sub-sector—with many of these BPO employees coming from financial and accounting, legal, and medical sciences backgrounds.”

Data on the relatively smaller outsourcing sectors of IT, transcription, animation, and game development revealed that these sectors have recovered from the global financial crisis as markets in buyer countries placed orders and started implementing stalled contracts in 2010. All sectors, except engineering services outsourcing (ESO), reported positive growth figures for employment and revenues. BPAP Senior Executive Director Gillian Joyce Virata explained that the construction and automotive industries have yet to fully recover in the key markets for Philippine engineering and design services such as the U.S. and the Middle East.

“The Philippines now leads the world in voice-based customer service,” added Benedict Hernandez, CCAP president. “We have solidified our global leading position with our agents providing the best customer service in the world. Confidence in our voice-based capabilities not only continues to drive market growth but also range of high-value services delivered out of the Philippines in areas such as financial services, marketing and research, and health care.” The contact center sector grew 21% to US$6.1 billion from 344,000 employees (up 23% from 2009).

Nora Terrado, President of the Philippine Software Industry Association (PSIA, which is a BPAP partner association), also reported that the Philippine ITO sector has recovered from the global financial crisis and grew at a healthy 28% in 2010. “We earned US$725 million in export revenues last year as our clients renewed their IT spending in anticipation of expansion after a year of hesitation.” There are now about 45,000 IT professionals employed in the country’s IT outsourcing sector, up 27% from 2009, according to PSIA’s just concluded IT Skills Inventory Survey.

The health care BPO sector, as reported by the Healthcare Information Management Outsourcing Association of the Philippines (HIMOAP, formerly MTIAPI; also a BPAP partner association) through its president Myla Rose Reyes, employed 14,000 health care professionals by end-2010 and earned US$102 million (up 11% from 2009). According to Reyes, the sector is evolving to prepare for a significant increase in demand for services from the United States as a result of reforms in U.S. health care regulations.

The industry’s creative outsourcing sectors, animation and game development, are represented by BPAP partner associations ACPI (Animation Council of the Philippines) and GDAP (Game Development Association of the Philippines). ACPI reported (through past-president Weng Bagadion) 18% growth in revenues to US$142 million in 2010 and GDAP (reported by its president Lyshiel Valencia) grew over 50% to almost US$7 million. Together, these sectors employ almost 10,000 creative and support workers.

“The industry data for 2010 proves that the Philippines leads the world in voice-based BPO services and is second only to India for total BPO exports,” concluded Sec. Ivan John Enrile Uy of the Commission on Information and Communications Technology (CICT). “We have also proven true the analyses by third-party research institutions that the Philippines is already an established player in non-voice IT-BPO services and a very capable provider of high-value, complex knowledge-based and creative services.”

CICT provided funding for BPAP’s Philippine IT-BPO Road Map 2011–2016 that projects that the industry’s baseline growth would be about 15% a year for the next five years. This would translate to 900,000 total direct jobs, 1.7 million indirect jobs, and US$20 billion in revenues. Ayala added: “But with greater collaboration from all stakeholders, including government and the academe, we have the potential to grow at 25% a year. This would create 1.3 million direct jobs, 3.2 million indirect jobs, and US$25 billion in export revenues. The demand is there; it is up to us to ensure we provide the supply.”

When presented with Road Map 2016’s scenarios late last year, the economic and education secretaries of the Aquino administration, led by Sec. Greg Domingo of the Department of Trade and Industry, confirmed that the government would continue to provide strong support. Secretary Domingo said that, “The IT-BPO industry is one our country’s key sunshine industries and a major job creator; we will definitely continue to help it to grow.” This assurance was followed by President Aquino’s announcement on December 1 that he would provide funding in the amount of P62 million through BPAP for the talent development, process improvement, and industry promotion initiatives outlined in its road map.

About BPAP
The Business Processing Association of the Philippines is the umbrella organization for the fastest-growing industry in the Philippines: value-driven IT and business process outsourcing. BPAP serves as the one-stop information and advocacy gateway for the Philippines’ IT-BPO services industry and has over 250 company members, including four sector association members: the Animation Council of the Philippines, Game Developers Association of the Philippines, Healthcare Information Management Outsourcing Association of the Philippines, and the Philippine Software Industry Association.

About CCAP
The Contact Center Association of the Philippines is the primary association of contact centers in the Philippines and over the last 10 years have served to support the industry’s growth and success through various programs in talent development, wellness and retention, country marketing, and business environment collaboration. It’s membership represent about 80% of the Philippine’s contact center employees and revenues.