Business Process Outsourcing (BPO), Philippines
A history of the BPO industry in numbers
It’s one of the most lucrative, fastest growing industries in the Philippines. Here’s how far it's come
MANILA, Philippines — One of the most robust sectors in the Philippines right now is the information technology and business process outsourcing (IT-BPO) sector. More than just a lucrative enterprise, the IT-BPO sector has also proven to be the largest and fastest growing industry in the country. There is no denying its major role in providing quality jobs and encouraging economic activity and investment even in areas outside Metro Manila.
Of course, the IT-BPO industry was not an overnight affair. Credit is due to the handful of individuals who saw the potential in the business in its early stages. Among them are the likes of Rainier “Bong” Borja, who is often regarded as the most articulate voice of the Philippine BPO industry; Karen Batungbacal for her early involvement and series of contact center firms; and Secretary Mar Roxas, who, during his tenure as secretary of the Department of Trade and Industry, saw the potential of the industry, reached out to key leaders to promote foreign investment, and helped shape the landscape of BPO into what it is today.
In fact, one of the key contributions Mar Roxas made to the BPO industry was lobbying in congress to revise Republic Act 7916, so that buildings or floors in buildings could register as an ecozone. That meant that the budding BPO industries were exempt from paying national and local taxes, and only had to contribute 5% of their gross income as tax — a major enabler during that time.
Another significant but unexpected contributor to the BPO industry was Bill Gates. He donated Microsoft Apps Licenses to the PCPS program, which not only saved the government huge expenditures, but during the critical, early stages, it also enabled the BPO industry to function and thrive.
In order to celebrate how far the Philippines has come, we’ve created a timeline of the BPO industry’s milestones in numbers. See how the IT-BPO sector transformed from a single contact center to the industry monolith it is today.
1992 - Frank Holz, under the Accenture group, created the first contact center in the Philippines
1995 - The Philippine Congress passed the Special Economic Zone Act, lowering area requirements for development and offering tax incentives to attract more foreign investors
1997 - Sykes Asia set up shop and becomes the first multinational BPO company in the Philippines
1999 - Jim Franke and Derek Holley found eTelecare, more popularly known as the first call center in the country
2000 - The BPO industry accounted for 0.075% of the country’s GDP
2001 - PeopleSupport, a US-Based outsourcing center, restructured their business, and moved their operations to the Philippines, providing 8,400 jobs
2003 - The Convergys Corp. opened up two call centres in the Philippines. The Philippines, along with India, was chosen by then president of the company, Jack Freker, as part of the company’s global expansion and revenue generation plan
2005 - The Philippines gained 3% of the global BPO market, which accounted for 2.4% of the country’s GDP
2006 - ePLDT Ventus was at the forefront of the local BPO landscape
•This improved the Philippine domestic economy by 5.4%
•11,000 people were employed across North America, Europe, and Asia
2010 - The Philippines was declared the world’s BPO capital!
•525,000 employees in call centres
•$8.9 Billion in revenue generated
•Revenues are expected to soar with a five-year compounded annual growth rate (CAGR) of 38%
•The country continues to become an attractive location for foreign investor
2011 – The BPO industry becomes one of the biggest and fastest growing job providers in the private sector
•$11B revenue generated and 638,000 Filipinos employed
•Revenue comprised 4.9% of country’s total GDP
2012 - The BPO industry grows even further
•BPO industry grew by 46% annually since 2006
•Revenue comprised 5.4% of the country’s total GDP
2013 - Revenue generated climbs up further to $15.5B and 900,000 Filipinos are employed full time
2016 - BPO industry is projected to generate 1.3M new jobs, with 17% annual growth