Outsourcing Industry Doubles Revenue Growth In Q1 of 2021
What good news awaits foreign and local outsourcing industry investors in the Philippines? It’s the fact that 84% of Business Processing Outsourcing (BPO) respondents experienced revenue growth with 32% growing over 50% from March 1, 2020, to Feb 28, 2021.
According to reports from a survey conducted by Outsource Accelerator, 76% of the surveyed companies experienced growth in ‘seats’ and 72% saw increased profitability. Only 12% observed a decrease in growth.
Derek Gallimore of Outsource Accelerator pointed out that there is a big chance for a second wave of growth in the outsourcing industry, further noting that this could generate 60 million more jobs over the next 20 years. Such a widespread growth in revenues, profitability and seats signifies the remarkable interest and growth of outsourcing despite the pandemic.
COVID-19 As Catalyst of Growth in Outsourcing
While the progress in the outsourcing industry is not a direct effect or result of the pandemic, it does help with the ‘new normal’. The current situation has caused people to become aware of and accept remote work. Additionally, COVID-19 has led people to embrace technology, including the tools being used in remote work. Companies, even the medium- and small-sized businesses, also started re-evaluating their spending and explored cost-saving options like offshore staffing.
Confidence in the Future of the Outsourcing Industry
The expectations for future growth remain positive with the BPOs being generally very confident concerning the future. About 72.8% and 92% of respondents expressed high expectations for the next 12 months and 5 years while only 11.7 indicated low expectations for the next 12 months.
Consequently, the International Monetary Fund (IMF) was optimistic about the Philippine economy and increased its GDP projection of 6.9% from the original target of 6.6% in 2021. As quarantine protocols ease out in Metro Manila, Bulacan, Cavite, Laguna, and Rizal, more industries can now reopen at limited capacity.
Results of the latest Business Expectation Survey carried out by the Bangko Sentral ng Pilipinas (BSP) also brought hope as the business owners’ Confidence Index (CI) for the first quarter of 2021 increased to 17.4% (60.5%) compared to the 4th quarter of 2020’s 10.6% (57.7%). This survey was done among 1,512 firms nationwide.
Moreover, Asia Pacific Real Estate Association (APREA)’s CEO Sigrid Zialcita remained buoyant towards the progress of the outsourcing industry, saying that it will remain a pillar of the real estate sector. Even real estate brokerage services company Leechiu Property Consultants (LPC) supported this statement by naming the BPO sector as the key factor causing an increase in office demand.
The talent solutions platform WorkBank Philippines, Inc. also concluded that the most active hiring companies are in the outsourcing and call center industry, information technology, manufacturing, and transport, and logistics.
Read about why Philippines is a top offshore office destination for businesses.
