10% peso drop v. dollar ‘to create more BPO work’-A A +A
Tuesday, January 21, 2014
THE peso’s over 10 percent fall against the US dollar is not only a boon to overseas Filipino workers (OFWs) and their families here, it will also enable the booming business process outsourcing (BPO) industry to produce more jobs at a faster rate in the months ahead, said House Assistant Majority Leader and Cebu Rep. Gerald Anthony Gullas Jr.
“Like exporters, BPO firms here get paid in dollars by their corporate clients overseas, but spend in pesos for their Philippine operations, such as the wages of their staff and office rent,” Gullas said.
“On account of the peso’s depreciation versus the US currency, BPO players here now have greater peso spending power that they may use to expand their business and hire extra staff,” Gullas said.
A significantly weaker peso means that BPO firms stand to receive more pesos to spend for every dollar that they earn, just like OFWs.
The peso closed at P45.00 to the dollar on Friday, its lowest level in more than three years. The local currency is now down 10.48 percent compared to its monthly average of
P40.73 to a dollar in January 2013.
Gullas estimates that BPO companies on average create one full-time job for every $10,000 that they spend to enlarge their highly labor-intensive, information technology (IT)-enabled business support activities.
Gullas is the author of a bill that seeks to reinforce the English proficiency of the nation’s future labor force participants by reinstating English, the world’s working language and language of technology, as the medium of instruction in all school levels. He is also vice chairman of the House committee on higher and technical education.
A large supply of college-educated, fluent English-speaking professionals has been a key growth driver of the BPO sector, which is projected to fully employ some 1.3 million Filipinos and generate up to $27 billion in annual revenues by 2016.
Gullas’s home province of Cebu is an outsourcing hub that now has 25 fully functional IT parks, plus 12 more being developed, providing plenty of office spaces and advanced connectivity to new BPO firms.
BPO firms in Central Visayas – mostly in Cebu and partly in Negros Oriental – already employ over 100,000 full-time workers, and yielded $516 million in revenues in 2012. (PR)
Published in the Sun.Star Cebu newspaper on January 22, 2014.