Where do startups fit in the local BPO industry?

GUEST COLUMNIST

By AMANDA CUA 

We all know the Philippines as a talent hub. Business Process Outsourcing companies (BPOs) alone contribute almost $30 billion to the national economy, and the country also holds around 10 to 15 percent of the global BPO market. Filipinos are well-known for their talents in customer service. But recently, we’re seeing a diversification of the kinds of jobs that are being offered, and startups are leading the charge. 

A new trend is here

Startups overseas, whether they are in the US, Europe, Singapore, or Malaysia, are hiring more Filipino talent. 

Look up different Singaporean startups on Linkedin, and you’ll be surprised to see Filipino names pop up across their “employee” page, mostly based in the Philippines. And many of these startups don’t even have a Philippine office! 

Especially with rising costs and after Covid-19, hiring remote talent (even at small startups) is becoming the norm. 

Filipinos are a global workforce with skills and qualities that match what companies are looking for. 

What we’re seeing?

Common roles that startups hire are for their sales and customer support. That’s nothing new — BPOs hire the same talents. 

But more and more, we’re seeing startups hire for a variety of roles even beyond that: marketing, engineering, HR, and operations. 

And they’re not just hiring for junior roles, mid and senior talents are also in demand. LinkedIn’s Jobs on the Rise 2023 edition points out that marketing and engineering were top jobs in demand for Filipinos. 

Because of this, recruitment companies in the Philippines have stepped up to link the local job market to global demand. 

Recruitment firms like Penbrothers work with companies to supply different types of talent, while local startups like Bossjob attract foreign companies to use their job posting platform. Coding bootcamps like Avion School focus on a specific type of role, like engineering. Coding bootcamps are short-term intensive training programs that teach practical, job-ready skills over short periods of time for those looking for roles in software engineering and programming. 

How is this enabled?

 If you’re a startup (let’s say, in Singapore) that wants to hire foreign talent, you don’t always have to open up your own local entity. 

It can be slow and expensive. Do it fast and hassle-free. You can use employer of record (EOR) solutions from companies like Deel, Multiplier, and Skuad. 

From the source. Coding bootcamps and recruiting firms can source and screen the talent for you — and some even go the extra mile to help you handle payroll, compliance, and more! 

Local job posting platforms. You can easily chat with potential candidates using online platforms like Bossjob, Jobstreet, Kalibrr, and LinkedIn. 

Why is this happening?

You could link this development to the remote work boom and the growth of global tech industries. With this, companies have more reason to extend opportunities outside their local workforce. 

According to Jobstreet, the IT/tech industry is one of the fastest-growing job markets as more companies are starting to digitize their operations. A 2021 Deloitte report also points out that IT services were one of the most outsourced services, with finance, payroll, and customer service trailing behind. 

The future of outsourcing

 The BPO industry is set to grow in the next five years, with a target of $59 billion and 2.5 million workers. 

Zooming out a bit, the Philippines has other Southeast Asian peers that are also outsourcing hotspots. Vietnam, for instance, has been a top place to hire software engineers, while Singapore is known for its highly-skilled talent pool. 

While there’s stiff competition from fellow SEA peers, the local BPO market is being supported by local policies–especially because they bring in jobs and revenues. In fact, the Department of Trade and Industry (DTI) has encouraged BPO development locally through tax perks. 

That said, there are still ways to go for the country to protect and empower the BPO industry. A new BPO worker's welfare bill was recently filed to introduce standards for fair labor practices, safeguard job insecurity, and address low wages. 

And startups’ hiring practices can play a role in the development of the industry in a few years. 

(Amanda Cua is the founder and CEO of Back Scoop, a media startup with a free newsletter that features news on business and startups in Southeast Asia.)