THE INFORMATION TECHNOLOGY and business process management (IT-BPM) sector saw its revenues jump by 10.3% in 2022, driven by key segments such as banking, financial services, and healthcare.
In a statement, the IT and Business Process Association of the Philippines (IBPAP) said the sector posted $32.5 billion in revenues last year, higher than the $29.5 billion in 2021.
The IT-BPM sector also saw an 8.4% increase in the number of full-time employees to 1.57 million.
IBPAP said the sector had “outperformed the aggressive targets” — 8-10% rise in revenues and 7-8% increase in full-time employees — set under the Philippine IT-BPM industry roadmap 2028.
“The boost in headcount and revenue may be attributed to growth in Banking, Financial Services & Insurance (BFSI), Healthcare, Retail, Technology, and Telecommunications,” IBPAP said.
For 2023, the IBPAP said it is targeting to increase the number of full-time employees by at least 8% to 1.7 million, and revenues by 10% to $35.9 billion.
The industry group said there was “significant expansion” in areas outside of Metro Manila last year such as in Cebu, Davao, Bacolod, Pampanga, and Laguna.
“Over 70,000 new jobs were created in locations outside Metro Manila — a 17% increase from the previous year. By the end of 2022, 31% of the sector’s total headcount or 486,000 (full-time employees) were in the countryside,” the IBPAP said.
The sector’s positive performance came as many IT-BPM firms shifted their registration to the Board of Investments from the Philippine Economic Zone Authority, in order to continue conducting work-from-home arrangements while enjoying fiscal incentives.
“We’re working on Roadmap 2028 with purpose and momentum. That’s the only way that we can hope to achieve our goal of building the industry to a 2.5 million-strong workforce and generating $59 billion in revenues for the country,” IBPAP President and Chief Executive Officer Jack Madrid said.
“We still have a long way to go, but Philippine IT-BPM’s stellar performance in 2022 brings us closer to generating 1.1 million new jobs for Filipinos.”
OPTIMISMCiting a survey it conducted, IBPAP said 83% of IT-BPM firms are expecting to post growth this year despite a potential global economic slowdown, while 17% are neutral on their projections.
“Results also showed that organizations will continue to outsource and use global business services this year as a lever to drive some of their cost optimization initiatives,” it added.
IBPAP’s survey showed more investments will come from animation and game development, contact center, cybersecurity, financial technology, healthcare, internet service providers, IT solutions, and shared services.
However, many companies believe that the talent and skills gap and cost pressures are some of the main business challenges they face this year.
Companies also noted that more work is being shifted to competitors in India, Poland and South America.
Other challenges include adapting to changing customer needs and business models, as well as insufficient supply of related infrastructure in the countryside.
To address these challenges, IBPAP will hold the IT-BPM Talent Summit on April 26 to 27. The event aims to help the sector establish a national upskilling framework, accelerate educational reforms, and create 1.1 million new jobs. The summit is being organized by the IBPAP in collaboration with the Trade department and the Board of Investments.
“This is just the tip of the iceberg. We have more partnerships, projects, and programs in the pipeline for talent development and the other acceleration levers and we don’t plan on letting up or slowing down because we realize that a lot is at stake here that’s beyond revenues, margins, or profits,” Mr. Madrid said.
The IBPAP has over 300 members and six partner associations consisting of the Animation Council of the Philippines, Inc., Global In-House Center Council Philippines, Contact Center Association of the Philippines, Game Developers Association of the Philippines, Healthcare Information Management Association of the Philippines, and the Philippine Software Industry Association. — Revin Mikhael D. Ochave