Economy B.P.O. HUBS' 'NEXT-WAVE CITIES'

26 March 2012

Manila, Philippines - Business Process Outsourcing (BPO) hubs in Metro Manila are eyeing relocation to cities and towns outside the metropolis. Metro Manila hosts 85 to 90 percent of BPO companies operating in the Philippines. Relocating them to urban centers outside the metropolis is expected to open more job opportunities and help ensure the companies' 24/7 operations.

Outside Metro Manila, cities are being promoted s alternative sites to ease the congestion in established information technology (IT)-BPO hubs. Urban areas that have efficient infrastructure, connectivity, and available human resources are called "next-wave cities," and they are becoming increasingly attractive to foreign investors. A study identified the 10 "Next-Wave BPO cities" as Davao City; Sta. Rosa City, Laguna; Bacolod; Iloilo; Cavite; Lipa, Batangas; Cagayan de Oro; Malolos, Bulacan; Baguio City; and Dumaguete, Negros Oriental. Other aspirant-cities are Dagupan, Legazpi, Metro Subic, Metro Naga, and General Santos.

A joint study by the Department of Science and Technology (DoST) and Business Processing Association of the Philippines (BPAP) showed Davao City, Sta. Rosa City in Laguna and Bacolod City as top three BPO locations among 34 domestic locations. In 2011, the $15-billion BPO industry employed about 525,000 Filipinos and had generated over $9.1 billion in revenues.

The supply of talent was the main determinant for a location's sustainability for hosting IT-BPO operations. In addition, other factors affecting city ranking are infrastructure, cost and business environment. Cities are scored on the quality of their roads, access to international and domestic flights, presence of providers of fiber optic networks, reliability of power supply, availability of property sites, cost of labor and office space, vulnerability to natural disturbances, and peace and order situation, among others.

With Business Process Outsourcing companies expanding out to next-wave cities and other key urban areas, the local Business Process Outsourcing industry expects to earn billions of dollars in revenues and give jobs to an additional half a million Filipinos by 2016. The Business Processing Association of the Philippines wants to double jobs in the sector to 1.3 million in the next five years, a third of which will be in cities outside Metro Manila. CONGRATULATIONS!