Contact centers grapple with human resource constraints

AGENT ATTRITION and slow hiring now threaten the call center industry’s expansion, the Contact Center Association of the Philippines (CCAP) warned during its two-day annual summit that started yesterday.

Consequently, the industry group announced plans to establish a Global Competitiveness Institute and form a Human Resource Council to address issues in enhancing employee talent, developing effective retention policies, and addressing labor disputes as part of efforts to ensure sustainable expansion for this sector.

“A 15% annual growth rate becomes more difficult as the base grows bigger,” CCAP President Benedict C. Hernandez said during a panel session on the first day of the International Contact Center Conference and Expo 2011 at the SMX Convention Center, Pasay City that ends today.

“One of the threats to the development of the Philippine contact center industry is the fact that we are not producing enough people who can qualify for the job.”

Citing data from his group’s annual report, Mr. Hernandez estimated that the industry now has a hiring rate of just 8%, meaning that only eight out of every 100 applicants are found to be competent enough to do the job.

Furthermore, the industry loses one out of every eight newly hired employees, he added.

Jojo J. Uligan, CCAP executive director, gave a similar assessment.

“On average, a call center has an attrition rate of 60%, but 20% [out] of this 60% leave the industry altogether,” Mr. Uligan said at the sidelines of the conference. “This gives us an industry attrition rate of 12%, since everyone else merely leaves a [call center] company and moves to another one.”

The CCAP report itself projected that the industry will have 406,000 positions by yearend.

This total factors in 62,000 new positions to be generated by expansion plans as well as 49,000 existing jobs to be vacated by workers leaving the industry altogether.

By 2016, total seats are expected to hit 816,000, including the need to replace 98,000 workers quitting the industry on top of hiring 106,000 new employees to support expansion.

To the association, these challenges are signs of insufficient education or training that yield low skill levels. “There is great opportunity to grow with global demand, but can we supply the talent?” the report said. “We need to reach at least a 12% hiring rate.”

The group cited specific challenges that have to be addressed.

First is the need to improve the qualifications of English instructors. “English teachers are core to the development of the call center industry, but many of our English teachers in our universities are not even qualified to teach this language,” Mr. Hernandez said.

Worse, he said, “more people are getting hired even without college degrees and some are even requiring only a high school degree.”

Mr. Hernandez said CCAP plans to form a Global Competitiveness Institute, “which will set the…standards for skills, assessment and training” — adding that “eventually, we want to hire people certified by the institute” — and a Human Resource Council that will ensure that industry compensation and other work conditions are competitive. — Eliza J. Diaz, Businessworld