MANILA, Philippines–The Philippine IT-business process outsourcing industry continued its strong rally last year, as it posted an 18.7-percent growth in revenue to about $18.4 billion.
Danilo Sebastian L. Reyes, chair of the IT and Business Process Association of the Philippines (IBPAP), said that the sector’s sustained growth was driven largely by the growing demand for its services from the global offshoring industry, particularly in the voice and non-voice sectors, healthcare information management, global in-house centers (GICs), as well as gaming and animation.
“We didn’t see any of these sectors contracting. In fact, all of them are growing. Even the contact center (sector) continued to grow by between 15 percent and 17 percent. Suffice to say that even with the challenges we face, the Philippine IT-BPO sector is still in the right path to achieving the major goals we have established, which was to hit $25 billion in revenue and reach 1.3 million in employment level by 2016,” Reyes said on the sidelines of the Asia BPO Summit on Wednesday.
Reyes said the industry was optimistic it would continue to grow given the diversification of the services offered and their contribution to the overall performance of the IT-BPO sector.
According to Reyes, the contact center sector is still the biggest revenue contributor, but new sectors are stepping up. These include the healthcare information management, which was the fastest-growing segment last year.
Prospects are bright for the healthcare information management, according to Reyes, given the ongoing implementation by the United States of the International Classification of Diseases 10 (ICD 10), which calls for the revamp of the US medical coding system.
This development in the US presents opportunities for the Philippines to provide the necessary offshoring services to US-based medical firms.
“If we capitalize on that opportunity, the growth of the Philippine healthcare information management industry will really shoot up,” he added.
Reyes noted that 2014 was a significant year for the industry because apart from sustaining a double-digit growth, it also breached the 1-millionth mark in terms of job generation.
As of the end of 2014, the IT-BPO industry employed some 1.03 million people. Of this number, 630,000 employees are with the contact center sector.
According to Reyes, the Philippines remains the top destination for IT-BPO firms given the country’s scalable, educated talent pool; cost competitiveness; excellent infrastructure; adequate government support for the industry; and a proven track record.
US-based companies account for 77 percent of the services being outsourced from the Philippines. The remaining 23 percent is shared mostly by those based in the Asia-Pacific.
For 2015, Reyes said the industry was expecting to hit $21.3 billion in revenue and 1.18 million in employment generation level.
In the meantime, the group is targeting to begin this year the crafting of a new road map for the industry beyond 2016 to set new targets and strategies that will secure the leadership of the Philippine IT-BPO industry in the global offshoring space.
According to Reyes, the new road map is likely to cover six years up to 2022.