The Philippine IT-BPM industry continues to shine as a beacon of opportunity in 2023, and is expected to propel economic growth and position the country further as a global leader in providing offshore resources to companies based in some of the biggest tech hubs in the world. This article explores the promising outlook for the Philippine IT-BPM sector for 2023 and beyond.
Ongoing Digital Transformation
The Philippine IT-BPM industry experienced blistering growth during the pandemic, and with remote work here to stay (despite calls to return to offices globally), the country is banking heavily on its ability to adapt to the global digital transformation. Locally, 80% of all IT-BPM employees have expressed strong preference for remote or hybrid work arrangements.
The country’s strategic location, skilled workforce, and a business environment that has taken strides to promote foreign investments and collaborations all factor into this growth. According to the Information Technology and Business Processing Association of the Philippines (IBPAP), the Philippine IT-BPM industry saw an increase of 8.4% or 121,000 full-time employees in 2022, now totalling 1.57 million FTEs. It also saw a growth of 10.3% in revenues to reach a total of $32.5 billion in 2022, surpassing the 2021 earnings of $29.5 billion.
These figures are significant deviations from pre-pandemic foredcasts of $38.9 billion in revenue growth and a total of 1.8 million FTE, largely due to the pandemic—according to Statisa, the Philippine IT-BPM industry revenue dipped from $26.3 billion in 2019 to $26.1 due to the pandemic.
That being said, the sector recovered strongly in 2021 ($29.5 billion) and continues to trend upwards as of 2023, putting it ahead of several other industries that stalled or totally shuttered during the COVID-19 years. This continued growth also reflects the industry’s adaptability and its ability to embrace digital transformation, enabling companies to thrive in a rapidly changing world.
Unique Filipino Talent
Tthe biggest growth driver for the Philippine IT-BPM industry is the fact that the skills required in many emerging technologies reside in the same people who can communicate effectively with clients, which is why more and more companies are tapping Filipino talent for high-level services.
To illustrate, companies who outsource from Central America and South America tech centers tend to run into interfacing problems, as the technical skills often reside in one group of people, normally the operations team, while the ability to communicate with clients lies in another group of people, usually business development and client relations departments. In contrast, Filipino workers are skilled in emerging technologies but are also effective communicators. This mix of hard skills and people skills in the same talent pool is why Philippine IT-BPM providers are able to offer services that are tailored to the clients’ needs and goals.
On top of this, the English-proficient Filipino talent remain relatively young and are among the most adaptable and resilent workforces globally, which are qualities that set it apart from other outsourcing hubs during the BPO/BPM boom in the early 2000s.
Strong Technology Adoption
Speaking of emerging technologies, the Filipino talent pool consists of quick technology adapters, and the country is seeing a massive rise in use cases for digital banking, blockchain technology, cybersecurity, and financial technology, to name a few.
They are also among the most well-adapted regions to machine learning, automation, data analytics, and artificial intelligence—and to reiterate, skills in these emerging technologies in the hands of effective communications and collaborators enables the Philippines to provide cutting-edge solutions to clients worldwide.
Also worth nothing is that the country is underoing a soft reform in the education sector, as it is shifting from traditional bachelor’s degrees to more in-demand courses and certificaitons that make workers a much better fit to clients looking to build offshore teams.
As of 2023, the Philippines government has committed to the growth of the country’s IT-BPM industry through regulatory reforms and the addition of more investment infrastructure. This can readily be seen through the development of specialized IT parks even outside of Metro Manila (i.e., in the Visayas and Mindanao regions) tailored to providing environments where companies engaging its IT-BPM resources can thrive.
Additionally the Department of Information and Communications Technology (DICT) is working on an ongoing with key organizations like the IBPAP for the Digital Cities 2025 initiative, aiming to expand the IT-BPM sector and bridge industry progress in the countryside to strengthen local economies, ergo, capacitating key locations outside of Metro Manila to become thriving business and investment hubs.
The Philippines IT-BPM industry remains a bedrock of economic growth and opportunity. For 2023, the IBPAP forecasts that the IT-BPM industry will generate 1.7 million FTEs and US$35.9 billion in revenues. Years further the association’s next IT-BPM Roadmap 2028 predicts the sector to generate over $59 billion in revenue, representing 8% of the Philippine’s gross domestic product.
Moving forward, I remain incredibly optimistic and confident about the future of the IT-BPM sector in 2023 and beyond. From its remarkable resilience throughout the pandemic to its unique and highly adaptable talent, to strong public and private investments into the sector, the industry will continue to provide more advanced solutions to a widening array of sophisticated clients. The Philippines is now the go-to global destination for high-quality outsourcing and Xelure is excited to be at the forefront of its evolution.