THE staff turnover rate in the Philippine business-process outsourcing (BPO) sector has reached an all-time low in 2014, according to a survey by Towers Watson, a global professional services company.
The survey said the Philippine BPO industry has managed to retain employees resulting in a 20-percent turnover rate, the lowest since 2007. The percentage is a marked improvement compared to the 33-percent, 24-percent and 26-percent attrition rates from 2011 to 2013, respectively.
Vangie Daquilanea, Global Data Services Practice head of Towers Watson Philippines, attributes the lowered attrition rate to the sector’s widening its talent search.
“The sector, though fast-growing, has adopted various strategies in talent acquisition, including expanding operations outside the National Capital Region [NCR], to tap talent in Cebu, Davao and Southern Luzon.
“This has, in turn, minimized talent movements within the NCR, registering the lowest attrition rate in the last seven years,” Daquilanea said in a statement.
The sustainability of the BPO sector in the Philippines is anchored on qualified talent availability necessitating BPO heads to look to areas outside the NCR. The Towers Watson survey also reported data on geographic differentials in the country, where Central Visayas is found to be about 23 percent lower compared to salaries in the NCR, making it a draw for BPO companies to operate in.
The overall salary increase in the outsourcing industry in the Philippines in 2014 was 7 percent on average, and is expected to be stable in the next two years at 7 percent to 7.5 percent.
The survey also found that employees in the outsourcing sector in the Philippines typically have a compensation mix, where guaranteed compensation is quite high, with a minimal annual performance bonus equivalent to about one month to one-and-a-half months’ pay.
The Information Technology and Business Process Association of the Philippines projects revenues to reach $25 billion in 2016, with 1.5 million new jobs to be generated as a result.
The growth of the BPO sector which, as of September 2014, already employs 1 million Filipinos, has been a key driving factor of the economy and has been cited by credit-rating agencies, time and again, as their basis for a stable outlook for the country.