Employee turnover rate in BPO sector slows

MANILA, Philippines–Employee turnover rate among Philippine business process outsourcing companies last year reached 20 percent, the lowest since 2007, as more companies were able to adopt strategies and compensation mixes that helped minimize talent movements.

These were the results of a survey conducted by Towers Watson, a leading global professional services company.

According to the survey, the latest attrition rate among the 80 companies polled was a big improvement from the 33 percent in 2011; 24 percent in 2012 and 26 percent in 2013.

In a statement, Vangie Daquilanea, global data services practice head of Towers Watson Philippines, said the Philippine BPO sector had seen a sustained growth in the past several years. The industry, according to Towers Watson, would likely see a “very bright future” given a strong economic growth, positive business environment, industry scalability, experienced talent availability, foreign language skills, and a share of the graduate pool.

“Companies in the Philippines have adopted various strategies in talent acquisition including expanding operations outside the National Capital Region (NCR) to tap talent in Cebu, Davao and Southern Luzon. This has, in turn, minimized talent movements within the NCR, registering the lowest attrition rate in the last seven years,” Daquilanea said.

In terms of salaries, the Towers Watson survey found that the overall salary level in the Philippine outsourcing industry rose by an average of 7 percent last year.

Salary increases are expected to stabilize at a rate of about 7-7.5 percent over the next two years.

“The companies budgeting for this salary increase rate typically use a performance matrix where exemplary performers are greatly rewarded, and nonperformers are given zero to minimal increases. This is being done by companies to give emphasis on their compensation principle of paying for performance,” Towers Watson said.