Thursday, November 06, 2008 Outsourcing to continue
Filipinos who anticipate that a Democratic administration in the United States will stem the flow of high-paying jobs in outsourcing need not worry, an official of the US Embassy in Manila said yesterday.
US Embassy Deputy Chief of Mission Paul Jones said he doesn’t expect a slowdown in outsourcing after President-elect Barack Obama assumes office on Jan. 20, 2009.
“There’s a real discussion on the effect that the current economy has on outsourcing, and there’s two ways of looking at that. Some can think in terms of keeping jobs in the United States, but on the other hand, companies generally find that it’s more efficient to be outsourcing to different companies around the world,” Jones said.
A change in administrations doesn’t negate advantages like the local residents’ grasp of English or their understanding of American culture, and the Philippines “remains a great country” for outsourcing.
“My expectation would be that there would be no reduction in outsourcing, that it would continue to be a robust part of the global economy, but you know it’s always hard to predict exactly how things would go,” Jones said.
Outsourcing and off-shoring’s contribution to the Philippine economy rose to US$5 billion last year, from $1.5 billion in 2004,
the year US President George W. Bush won a second term.
Keeping jobs
As its target, the Business Processing Association of the Philippines wants to corner $13 billion in outsourcing receipts by 2010. The association estimates that in Cebu, some 16,000 work in the industry, mostly in call centers.
But the Democrats, who count labor unions as part of their traditional sources of support, may be less likely to support outsourcing and instead emphasize the need to keep jobs in the United States.
In his acceptance last August of his party’s nomination, Obama said: “You know, unlike John McCain, I will stop giving tax breaks to companies that ship jobs overseas, and I will start giving them to companies that create good jobs right here in America. I’ll eliminate capital gains taxes for the small businesses and start-ups that will create the high-wage, high-tech jobs of tomorrow.”
Meanwhile, Mandaue Chamber of Commerce and Industry (MCCI) president Eric Ng Mendoza said Obama’s victory will raise optimism among market players but it is too early to tell how—and if—he (Obama) would be able to find timely solutions to the financial crisis in the US.
“There is optimism in market sentiment, but the US economy is still down there,” he said.
“It would depend on whether he will be able to deliver. What is clear, at this point, is that he (Obama) will be facing huge challenges when he assumes office,” he added. (IDA (with LAP)
