‘Many are called, but few are chosen’

Published by rudy Date posted on July 3, 2009

The business process outsourcing (BPO) industry in the country remains a booming sector, but few graduates are qualified to work in it, according to the Commission on Information and Communications Technology (CICT).

Only seven out of every 100 graduates are qualified to work for BPOs, which include call centers, medical transcription companies and back office services, CICT Commissioner Monchito Ibrahim said Thursday.

Ibrahim said this was because the skills the graduates got in school were not matched with the demands of the industry.

“The hire-ability of college graduates is 7 percent,” he said at a hearing of the House oversight committee. “The number one [challenge] is job skills mismatch.”

Pressed by lawmakers on what the CICT was doing to address the issue, Ibrahim said the commission was talking with officials of the Commission on Higher Education to introduce a science-based curriculum.

“Any course today needs to be service-oriented. One example of a subject we need to have is project management,” he said.

Graduates must be informed of the kinds of skills that the BPO industry needs so that they could choose courses that would give them a good chance of being hired, Zambales Rep. Milagros Magsaysay said.

Lack of privacy laws

Ibrahim said another factor that posed a stumbling block to the faster growth of the BPO industry was the country’s lack of data privacy laws.

This is crucial because the industry handles very confidential data, such as medical records, that need to be protected.

“We have a flow of very confidential data in the country but we don’t have a law [to protect that]. We need that. Hopefully, nobody notices that we don’t have a data privacy law in place,” he said.

Ibrahim said that if such a law existed, many BPO workers would be able to work from home.

Bright spot

Despite these obstacles, the BPO industry remains a bright spot in the country.

The Philippines has the third largest global market share of the BPO industry with 15 percent, behindIndia (with 37 percent) and Canada (with 27 percent).

From 2004 to 2008, BPO workers in the country grew from 163,000 to 372,000. As of May 2009, it had 435,000 workers, according to Ibrahim.

Revenue

The industry’s revenue in the country rose from $1.3 billion in 2004 to $6.1 billion at the end of 2008. Most of the revenue consisted of salaries of BPO workers.

The expected revenue for the end of 2009 is between $7.2 billion and $7.5 billion, Ibrahim said.

The average salary of a newly hired worker in the BPO industry is P13,000. Most of the workers are assigned to the graveyard shift, to coincide with daylight in the United States, and get paid night differential.

Call centers, or what he terms as voice-based services, comprise the biggest chunk of the BPO industry in the country, according to Ibrahim.

But he said the back office services, which is composed of services for financial accounting, human resource and credit and collection, are fast catching up.

These services are set up in the country when international corporations, for instance, remove their accountants in their global offices, and centralize their operations in the Philippines.

This practice has gotten the goat of US President Barack Obama, Ibrahim said. –Leila Salaverria, Philippine Daily Inquirer

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