Call centers forecast slowdown

A STRONG peso and the lack of qualified workers could dampen the growth of the call center industry over the next five years, according to the Contact Center Association of the Philippines.

In a briefing, Benedict Hernadez, CCAP president, told reporters that the industry is likely to grow a compounded annual growth rate of 15 percent over the next five years, slower than the 21 percent CAGR in the last five years.

For this year, the industry expects to hire 406,000 workers, up by 18 percent from the 344,000 workers last year.

CCAP aims to employ 816,000 workers by 2016 from the 160,000 in 2006.

Hernandez said CCAP aims to hit $7.1 billion in revenues this year, up by 14.5 percent from the $6.2 billion last year.

He said revenues are expected to reach $14.7 billion by 2016 from the $2.6 billion in 2006.

Growth would come from new geographical markets and verticals as well as the local industry’s capabilities in language support and higher value skills.

At present, market reach spans Europe, Middle East, Asia, Latin America and Australia.
Hernandez, however, cited challenges that could constrain growth over the next five years.

The executive said the industry’s main concern is ensuring the long-term sustainability of a qualified labor pool and talent retention.

“The demand is not the issue,” Hernandez said, adding that the issue is how the industry will supply the increasing demand.

For every 100 applicants, only eight are hired, according to CCAP.

Hernandez said foreign exchange stability is also a major concern.

“We do think about it a lot. We are not happy with this,” he said.

The industry assumed that the US dollar would average $43 to $44 this year.

Other challenges are labor inflation, poor infrastructure, costlier power and an unfavorable regulatory and incentive environment.

“In order to ensure the Philippine contact center industry maintains unhindered growth for the next five years, CCAP has undertaken an ambitious effort to transform the industry,” Hernandez said.

CCAP has adopted a five-year industry roadmap that focuses on improved speed, efficiency and scale.

Among the thrusts for the next five years are sustaining the supply of qualified labor, and elevating their skill proficiencies through the establishment of a Global Competitiveness Institute, a Human Resource Council, among other research interventions. –Darwin G. Amojelar, Senior Reporter, Manila Times