Business Process Outsourcing (BPO) can help businesses be more efficient and grow more quickly.

The strongest BPO partners can also take the distraction of entire business functions off your plate, allowing you to focus on other parts of the business and make faster progress on your mission.

So where are companies outsourcing?

There are a few common places, including the birthplace of the BPO movement – India. However, an increasingly large portion of businesses are choosing to outsource or hire talent from the Philippines.

Why the Philippines?

It’s simple— there are many advantages to hiring in the Philippines, and relatively few disadvantages. Arguably no other country in the world brings as strong of a set of benefits.

Let’s talk about a few of the reasons companies are choosing to move more and more of their operations to BPO’s in the Philippines.

1. Dramatic Cost Savings

Yep, everyone knows this one. But it’s important to mention. Relative to the United States, the cost of living in the Philippines is dramatically less.

An acceptable average income for a family of 5 in the Philippines falls between $1,000 and $1,700 USD a month. This makes monthly costs as low as $1,000 a possibility, even for relatively skilled roles.

In general it’s reasonable to expect to pay up to 70% less for a role that’s outsourced to the Philippines.

While the most niche and seasoned talent in the Philippines can cost significantly more than $1,000 a month, the 70% cost savings rule tends to hold roughly true. That caliber of talent would demand a premium in developed markets like the US, UK, or Australia as well.

These savings allow companies benefitting from Philippines labor to invest more in other areas like technology or marketing, or to achieve better profitability.

2. Decreased Real Estate Costs

Many employees in the Philippines have a preference for working at home due to long commutes. Businesses who hire these WFH employees are able to minimize real estate costs, and don’t have property rental processes as a barrier to entering the talent market.

The lack of real estate costs, when compounded with the affordability of labor in the Philippines, can make investing in Philippines talent even more than 70% less expensive than higher cost countries.

3. Deep Industry Expertise

When most people think of outsourcing to the Philippines they imagine roles like call center agents or personal assistants. However, the right BPO partner can quickly locate talent with great existing experience across a wide variety of advanced functions.

People in the Philippines have education and experience in a number of industries including Sales, Marketing, Customer Experience, Finance, Design, Recruiting, and IT.

The Philippines government has so embraced the BPO opportunity that it is investing in educational systems and post-education programs specifically to develop talent for it. Everything from internships to work immersions and government sponsored skills courses are readily available.

This is only further accelerating the growth of advanced and varied skillsets in the region.

4. 24 Hour Talent Availability

As the Philippines has become increasingly global, working a schedule outside of the typical 9-5 has become normalized for a growing portion of the population. It’s become so common, that the same caliber of talent can be found at all hours, and night or weekend cost premiums are as little as 10%.

The majority of BPOs in the Philippines are able to offer 24/7 services by having employees work on rotating schedules.

As a result, an entire function can be outsourced to the Philippines alone, without the need to employ talent from other regions. This can simplify business operations considerably.

5. Strategic Location With Minimal Risks

Businesses around the world can benefit from outsourcing to the Philippines.

The country is located near major Asian economies and the thriving Australia-New Zealand market.

For companies in these areas, outsourcing to the Philippines means having access to a huge number of potential employees just a few time zones away. For companies in other parts of the globe, the location can serve as a useful foothold for sales and partnerships in the region.

The Philippines is also a large region with strong talent exists throughout it. By hiring across multiple Philippines islands and cities, any business continuity risk from natural disasters is significantly reduced.

6. Fast Growing Economy and a Large Talent Pool

With a projected growth of 5.9% in 2024, the Philippines economy is growing twice as fast as the world average of 2.9%.

This flourishing economy means that more talent, and increasingly skilled talent, is surfacing in the Philippines every day.

Plus with a population of over 110 million people, the talent pool available in the Philippines is massive. Each year, nearly 800,000 students graduate and prepare to join the workforce. There is no shortage of motivated, well-educated, young adults who are seeking employment and career growth.

The Philippines talent pool is large and diverse enough to support businesses of any size, complexity, and growth rate.

7. High Retention

The cost and lost productivity from employee attrition is typically anywhere from 50-60% of that person’s annual salary, once you account for ramping time, recruiting, manager investment, etc.

Fortunately, retention among Filipino employees tends to be very high due to the loyal and familial culture that’s characteristic of the Philippines.

Not only does a high retention rate result in tremendous cost savings, it is also beneficial for your company culture.

These benefits tend to extend partially to the onshore teams in the company as well, who value the reliability and positivity of their outsourced partners.

8. Strong English Skills

Because talent with strong English-language skills is so sought after, learning fluent English has remained a priority in the country. Some studies place the Philippines as the third-largest English speaking nation across the world.

English is one of the official languages of the Philippines and the language of law and commerce. In schools, the majority of instruction is delivered in English, and top universities teach all of their classes in English.

English acquisition is so strong in the Philippines that students from China, Japan, Brazil, Russia, and other countries choose to attend Filipino universities for their graduate and postgraduate degrees.

Not only do many Filipinos fluently speak English, but many do so with a clear American accent and a familiarity with Western culture. People who speak to Filipino talent on the phone often don’t immediately assume they’re speaking to someone in a different country.

9. Service & Responsibility Oriented Culture

Filipino employees have a well-earned reputation for being hard-working and reliable. Diligence, loyalty, patience, and resourcefulness are deep cultural values exhibited by a large percentage of the workforce.

Staying on task and striving to excel are common practices, even without close management supervision. In addition, the work culture tends to be positive and familial, leading to strong social cohesion and good communication among coworkers.

10. Effortless Integration

Known as one of the friendliest and happiest countries in the world, it tends to be easy to collaborate witih Filipino employees. A cultural fondness for foreigners in particular helps facilitate cultural integration with overseas coworkers.

There’s a reason well-known giants including Amazon, Google, IBM, and Wells Fargo outsource a lage portion of their talent in the Philippines. With the potential to bring skilled and motivated talent at reduced labor costs, it’s a savvy business decision, when done right.

Catalyst BPX hires the majority of our team in the Philippines and encourages others to do the same— either directly, or in partnership with an experienced and well-connected BPO like Catalyst that can quickly staff you with the best talent the Philippines has to offer.