The local business process outsourcing (BPO) market will remain robust despite the global financial turmoil, but it will face HR challenges--particularly talent shortage and higher salary demand--as the sector copes with surging growth.
This is the prognosis presented by Canada-headquartered IT research firm XMG, noting that the decade-high inflation rate in the Philippines--at 11.4 percent--may push BPO workers to turn to their employers or the job market, in a bid to increase their pay to compensate for the rising cost of living.
In a report released by XMG stated that call center, IT and BPO companies in Metro Manila should brace themselves for increasing employee sentiments to have their salary reviewed to combat inflation.
Citing figures from the latest XMG Employment Lifestyle Index, the research firm noted that over 73 percent of respondents expressed a need for increased compensation from their employers. The index was conducted in the third quarter of 2008 and polled 100 ICT professionals working in Metro Manila.
"Of the 73 percent, over 70 percent are actively looking for better opportunities within the city or overseas. Only 12 percent are currently satisfied with their current salaries," the report stated.
Emerson Fababaer, research statistician at XMG, said the numbers indicated a genuine trend of employees demanding increases in the cash component of their remuneration. Lauro Vives, XMG's Filipino founder and chief analyst, said in the report that there were "very few extrinsic options" for employers to address the challenges.
"Either provide a relief in the form of increased compensation, subsidy or allowance, or position the current compensation package as being above industry," Vives said.
Based on studies conducted in the past, XMG said, companies have been able to address this by performing regular compensation benchmarks, as well as "aligning employee attitude and value in building a sense of ownership in the company".
Vives added: "This means a shift from a monetary-based attitude, to a self-fulfillment outlook." To raise employees' level of commitment and overall productivity, the XMG report suggested organizations frequently review their worker incentive programs. Companies should also independently monitor employee perception and behavior to accurately gauge employee sentiments toward the organization, the research firm said.
The good news is, the Philippine outsourcing industry will largely remain a bright spot in the next two years and continue to grow well into the next decade.
