The Philippines IT-business process management (ITBPM) industry has the potential to employ 2.5 million Filipinos in six years from the current 1.5 million jobs, according to the IT Business Process Association of the Philippines (IBPAP).
In a recent interview, IBPAP President and CEO Jack Madrid said this potential job opportunities as he urged the need for government to internalize the contributions of the industry to the growth of the domestic economy.
“I think we have the potential to increase to 2.5 million jobs in the next six years,” said Madrid.
Even during the pandemic, Madrid pointed out the industry reached employment to 1.5 million and $13 billion in revenues, which account for 7 percent of gross national product. “I mean, this is very, very significant,” he stressed.
Thus, he urged for the need for flexibility in government policy, referring to allowing hybrid work arrangement for the industry.
He added that there stand for work from home (WFH) arrangement is beyond the tax issue. “The tax issue is just part of a very complex set of issues and taxes one, but from my association’s point of view, what we're talking about here is really the future of work,” Madrid said.
With that, Madrid has urged for flexibility because the ITBPM industry is not going back to 100 onsite work or in their approved physical ecozone location based on their registration with the government.
Based on various surveys, as much as 80 to 90 percent of employees and employers in the industry prefer a hybrid work environment. At present, ITBPM firms are operating 60 to 70 percent WFH and only 40 to 30 percent are working in their physical offices.
“That kind of balance is probably something that will be acceptable,” he said.
It could be recalled that ITBPM firms registered with the Philippine Economic Zone Authority (PEZA) were allowed to work 90 percent WFH during the pandemic. This privilege though already expired on March 30, 2022, but PEZA has been allowing their enterprises to operate 70-30 hybrid work ratio in favor of physical location. But the Department of Finance said these firms risk losing their tax incentives if they will not go back 100 percent in their approved ecozone location, which is part of their contracts for the availment of tax incentives.
But Madrid said, the pandemic did not even hinder the industry’s growth where almost 30 of their workforce, moved to the countryside during the crisis.
“This supports the future of an industry that is going hybrid, otherwise we will not grow the industry in the Philippines,” he added.
In fact, India, the Philippines closest competitor in the ITBPM space, is changing their laws, allowing players for hybrid work arrangement.
“In growing investments and investors, India has the same economic zones and they're really changing their laws. Decoupling tax incentives from work, we need we need to catch up with it,” he added.