No change in business policy — BPO

The Business Processing Association of the Philippines said Friday it will continue supporting the American economy and businesses amid speculation that reelected US President Barack Obama may resurrect talks on the enactment into law of an anti-outsourcing bill in the US Congress.

“While there has been speculation that the anti-outsourcing legislation may be revisited, the Philippine IT-BPO industry will continue to support the US economy and American businesses to help ensure they are among the most competitive in the world while freeing up resources to create more jobs in the US,” group president and chief executive Benedict Hernandez said in a statement.

Hernandez said the Philippines was helping to make American companies outsourcing business services to it more competitive and profitable.

“Profitable companies hire more workers both here and in the United States,” he said.

On Wednesday, US Ambassador to Manila Harry Thomas Jr. said Obama would most likely support legislation that would make business process outsourcing companies in the Philippines less attractive to American companies.

Thomas made the remark at a press briefing after he was asked about an anti-outsourcing bill that would give incentives to American companies bringing back jobs, many of which have been outsourced to other countries including the Philippines.

The outsourcing bill, called the “Bring Jobs Home Act,” failed in the US Senate in July. It was intended to eliminate the tax breaks for US companies outsourcing services and manufacturing jobs to other countries and to provide a 20-percent tax deduction on costs associated with closing outsourced operations and transferring jobs to the US.

Hernandez said many studies had shown that outsourcing had very little negative impact on job losses, but was in fact fostering job growth in the companies outsourcing business processes.

“Dartmouth’s Tuck School of Business economist Matthew Slaughter, in a study of the hiring practices of 2,500 US multinationals, found that for every job outsourced, nearly two new jobs were created in the US,” Hernandez said.

From a $35-billion global IT-BPO market in 2009, the industry is expected to generate at least $220 billion in revenues this year, according to a report by the Everest Group.

“The demand for global IT-BPO services is huge and continues to expand at a rapid rate,” Hernandez said.

“Outsourcing is a win-win proposition, and we believe that both American and Philippine companies–and American and Filipino workers–will continue to benefit from the opportunities it provides.”

In 2011 the Philippines’ IT-BPO industry generated more than $11 billion in revenue and employed almost 640,000 Filipinos.

According to an industry road map, the industry is expected to grow to gross $25 billion and employ 1.3 million by 2016. –Julito G. Rada with Lailany P. Gomez, Manila Standard Today