2021 Look Back: The State of BPOs in the Philippines amidst the Pandemic

“In the face of challenges like natural disasters, the financial crisis and, most recently, the Covid-19 pandemic, the [Philippines’ Business Process Outsourcing] industry has been able to sustain its annual growth both in terms of jobs and revenues” – Rey E. Untal, IT and Business Process Association of the Philippines (IBPAP) President

The Business Process Outsourcing (BPO) industry in the Philippines has been the backbone of the country’s economy since its beginnings in the early ‘90s, contributing to nearly $30 billion of the economy each year. Now more than ever, the BPO industry continues to be a lifesaver, not just for the economy, but for over 1 Million Filipinos. According to the IT and Business Process Association of the Philippines (IBPAP), the industry reported around 1.44 million full-time employees in 2021.

Not surprisingly, the Philippine BPO industry managed the pandemic better than almost any other. The IBPAP President and CEO Rey E. Untal announced that there was a notable demand for IT outsourcing in the latter part of 2020 as global businesses invested heavily in digitization to mitigate the remaining risks presented by the pandemic. Outsourcing also surged as a way to enhance their business continuity plans.

Depicted below are the factors that shaped the Philippine BPO industry in 2021:

BPO as an Essential Industry

“We were marked as an essential industry early on and received quite a bit of concession that helps the sector [to] mobilize both cargo and personnel,” Untal said. “This then allowed us to achieve enhanced operations alongside our service providers while ensuring the health and safety of our employees.”

According to the IBPAP, demands from several industries such as healthcare, e-commerce, retail, banking, financial administration, and telecommunications have helped BPOs not only to stay afloat but to grow during the pandemic. Being on heightened restrictions or lockdowns has magnified the need for businesses to outsource their manpower worldwide.

Hybrid Work

As an essential industry, business continuity for the BPO industry of the Philippines was of utmost importance when the pandemic hit. Taking in consideration their employees, most BPO companies implemented a hybrid work or remote work arrangement.

In a 2020 survey made by Sprout Solutions, data showed how the Enhanced Community Quarantine was implemented throughout the country. With 31 percent, the BPO industry led the initiative. The information and communication sector followed with 9.79 percent, and the healthcare industry was next with 8.51 percent.

As in the words of Untal, “There has been a growing requirement for work-from-home delivery as clients realized and accepted that remote work can be done without necessarily sacrificing employee activity and quality.”

According to the IBPAP, the Philippine BPO industry has an average ratio where 64% of the staff and 36% remain on-site. However, more than a hundred companies are implementing a 90 to 100% remote working arrangement.

Additionally, the IBPAP also stated that most BPO companies allocated an additional budget for employee assistance during the pandemic.

Outsourced Creatives Gaining Traction

The Creative Economy Council of the Philippines (CECP) estimates that 1.3 million to 1.5 million Filipinos are already on international online platforms for creative work and services like web design, multimedia content, and editing.

According to CECP President Paolo A. Mercado, digital creative and digital content services such as digital marketing and web design were the least affected segments in the creative sector last year. This is due to the remote work flexibility these jobs offer.

Consequently, the Creative Economy Council of the Philippines (CECP) submitted a Creative Economy Roadmap to the Department of Trade and Industry (DTI) and the Board of Investments (BOI). This roadmap outlines specific plans for advertising, film, animation, game development, and design. It aims to make the Philippines the top creative economy from the Association of Southeast Asian Nations Region by 2030.

Multiplier Effect on the Philippine Economy

Sustained growth in Philippine BPOs has also triggered a multiplier effect in other business sectors. The IBPAP notes that BPOs are among the major sources of foreign exchange in the Philippines and have also been a driving force for the real estate market, due to the industry’s office space requirements.

On average, about 45% of the total demand in real estate was accounted for by the BPO sector. But the multiplying influence of the Business Process Outsourcing industry does not stop there. According to Jobstreet, business process outsourcing was the top hiring industry in the country as of September 2021 – taking up 22.4% of job postings on the website for IT  and customer service.

The Emergence of a Growing Need for BPO in Healthcare

The healthcare sector makes up over 10% of the BPO industry, providing services to companies through the processing of medical billing, medical coding, case management, benefits management, and fraud/abuse management, to name a few.

According to the Healthcare Information Management Association of the Philippines (HIMAP) Vice President Vincent Remo, companies in the healthcare and medical industries have been dealing with rising cost and margin pressures. This makes outsourcing workers in the Philippines, with its wide selection of experts and professionals, even US registered nurses, the most cost-friendly and time-effective choice for them during the pandemic.

The Philippine Business Process industry in 2021 thrived in spite of the pandemic. It is only expected that BPO will continue to shape the nation’s economy.

To learn more about outsourcing, you can read our Top 8 Qualities of an Outsourcing Company in the Philippines article. We invite you to follow us on social media and to visit our website to learn more about our services.

banner-finalAbout Us: Sourcefit is a widely recognized US-managed business process outsourcing company based in Manila, Philippines. We proudly serve over 100 clients with a workforce of more than 1,300 employees. Our global centers can serve multiple markets, and our staff is highly proficient in English, Spanish, French, and Portuguese. Whether you need a few or many employees, we can help you achieve your business goals and build high-quality offshore teams.

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Sourcefit’s commitment to excellence has been recognized through numerous industry awards and certifications.

We recently received the Fortress Cyber Security Award from the Business Intelligence Group. Sourcefit was also honored with the prestigious recognition of Best Outsourcing Solutions Provider in the Philippines during the 2023 Business Excellence Awards.

Other awards include: FT ranking of 500 high-growth Asia-Pacific, The Marketing Excellence Awards, Inquirer Growth ChampionHR Asia Awards, among others.

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