THE IT and Business Process Association of the Philippines (IBPAP) is scheduled to meet its members next week to discuss its way forward should its appeal for the government to extend the work-from-home (WFH) arrangement be denied.
The Philippine Economic Zone Authority (Peza) earlier proposed to the Fiscal Incentives Review Board (FIRB) the approval of a policy that will allow its registered information technology-business process management (IT-BPM) enterprises to operate under a WFH arrangement without the requirement of 10 percent onsite capacity until Sept. 12, 2022, without diminution of fiscal incentives.
“The IBPAB continued to push for another extension to allow members a longer runway to transition their operations because there are things that take time... We are still waiting for an official word on this. But I must say that we need to be prepared, especially with the intent of our government to fully open the economy by the end of February,” said Jack Madrid, IBPAP president, during the virtual IT-BPM Forum hosted by the Canadian Chamber of Commerce of the Philippines, Thursday, Feb. 24, 2022.
Last September, the FIRB released Resolution 19-21, which allows IT-BPM firms in economic zones to implement 90 percent WFH arrangements until March 31, 2022. Under this setup, the IT-BPMs in economic zones can keep enjoying their tax incentives if at least 10 percent of their workers report in the office.
“We need to be ready to make plans in the scenario that our request will be denied. IBPAP will be meeting its members next week to discuss the way forward,” said Madrid.
Clients demand WFH
According to Madrid, the WFH setup has been beneficial to the industry to perform remarkably even amid the Covid-19 pandemic.
Jojo Uligan, president of Contact Center Association of the Philippines, said 65 to 70 percent of its member contact centers have been under the WFH arrangement since 2020 to make sure business operations continue while making sure employees are safe.
“The WFH scheme is here to stay in the Philippines because clients are asking for it and we’ve proven to our clients that it (WFH) works, that it can help us improve productivity and talent retention,” said Uligan, noting that clients have been asking some players to continue the WFH arrangement or a 50:50 mix for some new contracts this year.
“With all the easing of restrictions, we are looking at an average of 30 to 40 percent of our members to still continue the WFH arrangement. But still, it depends on the client,” he added.
2021 performance
Despite the challenges, the IT-BPM sector was expected to have grown as much as 12 percent in revenue and eight percent in employment in 2021, driven by the growth in healthcare, creatives and information technology services.
Madrid said the sector in 2021 likely followed the same growth trajectory of the global industry.
A study by its research partner Everest Group showed that the global industry should have grown seven to eight percent in terms of full-time employees and eight to 12 percent or even up to an impressively high 13 percent growth in revenue generation.
“This signifies a shift to more digital and more complex work. We are also seeing our sector continue to create job opportunities for more Filipinos,” Madrid said.
Data from job portal Jobstreet.com revealed that the IT-BPM posted over 80,000 job openings from January to September 2021. “That’s only nine months but that’s 30 percent higher than the full year of 2020,” he said.
The sector also remained the single largest absorber of office demand with office spaces reaching 254,000 square meters during the first 11 months of 2021. Madrid said this demand wasn’t only concentrated in Metro Manila but was distributed in Cebu, Iloilo, Clark and Davao.