The Outsourcing Week in Review: Thursday, March 24, 2022

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THE WEEK IN REVIEW

The Philippines’ Health Information Management Services (HIMS) industry is projected to make $5 billion in revenue this year, with an estimated growth of 7.3% to 10%. According to Department of Trade and Industry (DTI) Assistant Secretary Rafaelita Aldaba, the country is turning into a “one-stop-shop” as it runs an integrated Information Technology-Business Process Management (IT-BPM) services that combine technology, voice, and non-voice offerings. This would potentially transform the country into Asia’s hub for healthcare-BPM services.

Last week, we reported about the organizations that are opposing the Fiscal Incentives Review Board (FIRB) return-to-office orders. Now, several groups are speaking in support of this transition.

The National Economic and Development Authority (NEDA) is backing FIRB’s decision to maintain the March deadline of remote working arrangements in the Information Technology-Business Process Outsourcing (IT-BPO) industry. In a virtual briefing, NEDA Secretary Karl Chua said that while he understands the sector’s concerns, “the rest of the economy has already shifted to working back in the office.” He added that since the tax incentives are tied with economic zones, employees can’t keep working from home. Several big business groups and companies  — including the Philippine Chamber of Commerce and Industry, Chamber of Real Estate and Builders’ Association, Ayala Land Inc., Megaworld Corp., and Robinsons Land Corp. and SM Prime — also voiced their support for this transition. In a joint statement, the group of firms all agree that on-site work will help boost the economy back to its pre-pandemic levels. They are also hoping that it could restore displaced industries as it fuels confidence among enterprises.

Meanwhile, the Department of Energy (DOE) is suggesting another approach — a four-day workweek. During the weekly Talk to the People briefing, DOE Secretary Alfonso Cusi said that this proposal will prevent people from traveling to and from their workplaces, especially now that fuel prices are surging. Department of Labor and Employment (DOLE) Undersecretary Benjo Benavidez added that implementing a four-day workweek will not need any new law or Department Order as it is considered a part of the flexible work arrangement.

To assist employees in returning to the office, the Cebu City Emergency Operations Center (EOC) presented a set of guidelines to Mayor Michael Rama and several outsourcing firms in the city’s major ecozones. The proposed regulations include flexible work, social distancing, minimum public health standards, and designating Health Infection and Prevention Control Officers (HIPCO) per office. The organization also suggested proper ventilation in every office space, proper cleaning and disinfection processes, mask mandates, and regulation on using the pantry and mess halls. Moreover, immediate quarantine, isolation, and remote work for COVID-19 patients are suggested to prevent the spread of the virus in the office environment. In Iloilo, 10 large IT-BPM companies with around 13,000 workforce are ready to get back to their offices this April. In an interview, Iloilo Federation for Information Technology (IFIT) Executive Director Joeven Tansi said that these firms have already started planning out the logistics in returning their employees on-site. Iloilo has around 97 IT-BPM firms that employ about 36,000 professionals in the province.

Real estate investment trust Filinvest REIT Corp (FilREIT) is expecting a real estate leasing boom as outsourcing firms slowly return to their offices. FilREIT CEO Maricel Brion Lirio said that this order would boost the economy and push job creation, consumer spending, and business growth. FilREIT has one of the largest percentages of BPO tenants among Philippine REITs at 90.8%.

Still hopeful about the work from home model, the Philippine Economic Zone Authority (PEZA) told companies to comply with FIRB’s order “for the meantime” to avoid any penalties while they engage in talks with the investments board. Director-General Charito Plaza promised that they would continue convincing the government to overturn this decision. In fact, the agency cited several grounds to allow hybrid work arrangements in the sector. Plaza stated that organizations could continue working half on-site and half-remote as long as they have a 30% domestic sales allowance and 70% export requirement. In support of PEZA, property firm Colliers said the hybrid push could build “optimal work regulations in support of both economic and business growth.”

In expansion updates, IT outsourcing services provider transcosmos opened its second operations center in the Philippines called Manila Center 2 to accommodate increasing demand in the market. Located in Quezon City, the new facility will mainly cater to the company’s contact center and BPO services for both global and local clients. This joins the company’s Asia Pacific operations in Vietnam, Thailand, Malaysia, and Indonesia.

Just last week, Teleperformance Philippines held another on-site vaccination drive in EDSA, Quezon City. Offering nighttime inoculation for employees and city residents, the call center branch vaccinated about 500 children and adults during its launch. Teleperformance Site Director Ryan Sumera said that office jab drives are “already an incentive” as it does not cause any work disruption. According to the Department of Health (DOH), around 65 million Filipinos (over 72%) of the target population had been fully vaccinated.

The number of unemployed Filipinos decreased by 6.4% to 2.93 million last January even as mobility restrictions were tightened due to the COVID-19 Omicron variant. The Philippine Statistics Authority (PSA) reported that this is the country’s lowest unemployment rate since the first quarter of 2020. National Statistician Claire Dennis Mapa explained that the lower unemployment rate can be ascribed to a lower labor force participation rate of 60.5% which was a result of heightened restrictions at the start of the year. However, the Asian Development Bank (ADB) said that the Philippines will have to upskill its workforce to address the growing gap between employee skills and workplace expectations. In its latest report, the ADB stated that the pandemic “disproportionately affected young people” in the country. This incident, as well as the accelerated digital adoption of most companies, will increase skills mismatches for displaced workers.  The regional development bank suggested that the government should invest in upskilling its workforce through industry-led training and apprenticeship programs.

Speaking of the digital shift, the Department of Information and Communications and Technology (DICT) said that the country’s cyberthreat defense is still at level 1 — or the “infancy” stage — in terms of awareness and communication, and cybersecurity skills and expertise. In a virtual interview, DICT Acting Secretary Emmanuel Rey Caintic said that there is still much work to be done to strengthen the country’s cybersecurity. Caintic disclosed that they are aiming to reach level 5 — or the “resilient enterprise” level — in the next five years.

One step at a time!

Thursday, March 24, 2022

NEWS THIS WEEK

23 March 2022

• PH bank’s Q4 loan grew by 5.93%, fastest since the start of pandemic – read article…
• Real estate leasing to experience boost as BPOs return on-site – FilREIT – read article…
• PH Jobless rate down to 6.4% in January – read article…
• PH cybersecurity still in the “infancy” stage – read article…

22 March 2022

• Teleperformance PH holds COVID vax drive – read article…
• Duterte signs PSA amendment – read article…
• Big biz groups back return-to-office order – read article…
• 10 huge BPO firms in Iloilo Ready to get back on-site – read article…

21 March 2022

• Cebu City EOC recommends back-to-office guidelines – read article…
• PEZA cite grounds for hybrid work push – read article…
• Legislator offers to mediate on-site work arrangements for BPOs – read article..
• TaskUs showcase initiatives for women employees – read article..

18 March 2022

• BPO workers who refuse to return on-site will not be terminated — DOLE – read article…
• Back-to-office plans may hurt PH ‘competitiveness’ — Colliers – read article…
• PH HIMS sector could reach $5B by year-end – read article…
• transcosmos opens new operations center in the Philippines – read article…​

17 March 2022

• PEZA advises BPOs to comply with FIRB in the meantime – read article…
• NEDA supports back-to-office mandate – read article…
• PH workers need to upskill after pandemic — ADB – read article…
• DOE supports 4-day work week – read article…

Read more Inside Outsourcing Newsletters here:

1. The Outsourcing Week in Review: March 22, 2022
2. The Outsourcing Week in Review: March 29, 2022