As tech disruptions fuel the digital age, businesses must find ways to adapt within budget without compromising quality. One strategy used for globalization is IT outsourcing. The Philippines and other countries in the APAC region continue to be the most favorable locations for offshoring services as the need for an IT-focused workforce continues to grow. 
‍

According to Kearny, a country’s ability to reskill and redeploy its workforce amidst changing market trends drives its attractiveness as an outsourcing hub. This concept was identified as “regenerating the talent supply”, wherein the workforce adapts to an ongoing disruption by creating a professional pool with updated skills or a professional pool ready to be equipped and re-equipped to be redeployed to newly emerging roles.
‍

In a study by the IT Business Process Association of the Philippines (IT-BPAP), around 850,000 college graduates were estimated to fuel the country’s workforce annually. By 2022, the country could employ around 16 million FTEs for IT-BPM services. 
‍

At present, the Philippines already has a 17% talent market share in the BFSI, technology, retail, and healthcare sectors, and it also sees potential in emerging markets within the manufacturing, energy, and travel industries. With these opportunities ahead, 60% of outsourcing companies are upskilling their employees to capture these untapped markets. 
‍

The Philippines remains top-of-mind in outsourcing because it is actively seeking ways to grow alongside emerging markets and economic disruptions. It also recognizes the gaps that must be filled to enable its growth. With these in mind, here are a few more specific reasons why it is a worthwhile investment to get into IT outsourcing. Philippines outsourcing, specifically, is a key business strategy because of the following benefits.
‍

Macroeconomic Advantages

The Philippine outsourcing industry gets its biggest support from the most important authority--its government. The Philippine government established key organizations to ensure the country becomes attractive for foreign investments, and these organizations carry on their mandates amidst electoral changes. The creation of special economic zones in the country, supervised by PEZA, transformed not just Metro Manila but also other supercities such as Cebu, Davao, and Bacolod into viable options for offshoring businesses. 
‍

This strategy is just part of a two-pronged approach to preparing the country for outsourcing opportunities. Upskilling the local workforce is implemented by the government via TESDA, with some special courses offered to overseas Filipino workers’ dependents as well as OFWs themselves who returned and wanted to rejoin the local workforce. Public science schools and national universities are also provided with the latest infrastructures and financial assistance, ensuring that students who qualify in these schools are duly supported. 
‍

According to Statista, the Philippines remains attractive for IT outsourcing due to its growing GDP. Compared to other developing countries, most foreign investors also see the Philippines’ government as more stable. 
‍

Cost-effective Highly Skilled Workforce

High literacy rates and a growing population are key factors that enable talent regeneration in the country. Filipinos can also take advantage of fluctuations in the dollar-peso exchange, making remote work more appealing to skilled professionals. By outsourcing to the Philippines, you can cut operational costs by up to 60% as average hourly rates in the US fall around 20 USD.
‍

The Philippines has a lower cost of living than most Western countries, such as the US and the UK. Thus, establishing outsourcing hubs outside of Manila has become a business strategy, as these cities have even lower living costs than the country’s capital. This also helps expand job opportunities nationwide and tap into a bigger workforce beyond what’s currently available in Manila. 
‍

When you run a business 24/7, the outsourced services can be assigned to conduct customer support and pre-sales or cold-calling efforts. This can help ensure that your sales initiatives are running round-the-clock. 

‍

Download the Salary Guide to compare average salaries of top NetSuite ERP professionals.

download salary guide

‍

Compatible with Western Cultures

Filipinos have high English literacy, especially in non-Tagalog-speaking regions within Visayas and Mindanao. By having a time zone opposite most areas in Northern America, the US, and the UK, businesses looking to provide 24/7 customer services or support their worldwide offices can implement shifting schedules by outsourcing their teams in the Philippines. 
‍

In general, Filipinos are also exposed to current events happening in the West. A lot of Filipinos themselves have families who migrated to countries like Canada and the US, making them familiar with Western cultures. Filipinos’ inherent patience, warmth, and resilience contribute to the local workforce’s ability to handle customer-facing roles. These same unique Filipino traits may also be helpful when addressing issues in high-pressure environments like the ones in IT.
‍

Cybersecurity and Data Privacy Measures

Cybersecurity and data privacy are chief concerns proactively addressed by the Department of Information and Communications Technology (DICT). This government agency implements and supervises various Philippine laws related to security and data privacy, such as the Data Privacy Act, Internet Transactions Act, and Cybercrime Prevention Act. 
‍

These laws aim to preserve the integrity and confidentiality of user data and protect online content as well as computer data from being misused. The agency also works with local law enforcement authorities to ensure that offenders will be dealt with accordingly. 
‍

These laws enabled the Philippines to participate in emerging trends within fintech and implement digital banks for individual consumers. In turn, the emergence of these businesses created a pool of local talents specializing in information security, such as network engineers and system administrators, to name a few. To date, foreign companies have also established local teams to address IT services for company locations near the Philippines. 
‍

Building a robust team of IT professionals to help scale your business does not have to come at the cost of quality. You can look into outsourcing to help cut back on the administrative efforts you can otherwise skip. Consider an offshore strategy, such as IT outsourcing in the Philippines. To learn more about your options, talk to us today and allow us to help you assess what your business needs. 

‍