IT-BPM revenue to double by 2028

MANILA, Philippines — Annual revenues of the country’s information technology and business process management (IT-BPM) sector are expected to nearly double by 2028, according to the IT and Business Process Association of the Philippines (IBPAP).

Based on the IBPAP’s recently launched Philippine IT-BPM Industry Roadmap 2028, the industry is targeting a compound annual growth rate (CAGR) of 10.4 percent in the next six years, with annual revenues seen reaching $59 billion by 2028.

This is nearly double the industry’s $29.49 billion annual revenue in 2021, a 10.6 percent growth from the previous year.

“Since Roadmap 2022 was launched in 2016, we’ve seen just how significant and widespread the achievements and contributions of the IT-BPM industry are,” said IBPAP president and CEO Jack Madrid.

“By the conclusion of Roadmap 2028, we aim for the sector to create even more positive impact as we envision the Philippines to become the world’s number one experience hub for customer-centric and digitally-enabled services while driving sustainable economic and social growth,”he said.

Apart from the revenue target, the roadmap also aims to create an additional 1.1 million jobs in six years, 54 percent of which will be in the countryside.

IBPAP said this would bring the sector’s total headcount to 2.5 million by 2028.

Highlighting the industry’s multiplier effect, IBPAP also projects generating up to three million indirect jobs for allied sectors such as retail, hospitality, infrastructure, transportation, and real estate.

“The growth of the industry is a goal that we must all work toward as a collective, even as external and internal factors shape the opportunity landscape,”Madrid said.

“These include the global economy, overall demand for IT-BPM services, the adoption of hybrid work models, infrastructure development, supply of skilled talent, and favorable government policies,”he said.

To realize Roadmap 2028’s vision, IBPAP provided high-level recommendations for its strategic priorities and acceleration levers.

This includes policy and regulatory support as it stressed that the government needs to enable an enhanced business-friendly environment through unambiguous and relevant policies, which are in line with global and local market macrotrends.

“These will help bring forth easier adoption of hybrid workplace models, uniformity in workplace incentives, and strengthen the Philippines’ cost competitiveness and overall ease of doing business,” IBPAP said.

Another recommendation is talent development, as it emphasizes the need to ensure sustainable supply of skilled talent by revising existing curriculum and introducing new and future-relevant educational courses including early-stage interventions like internships and work immersions.

It said the creation of an IT-BPM talent hub would be beneficial in strengthening training programs and proactively positioning IT-BPM as a preferred career option.

IBPAP also stressed that the continued development and strengthening of infrastructure remain crucial to supporting IT-BPM operations in Metro Manila and other provinces.

The group also emphasized the need for a country rebrand, which would help reimagine the Philippines as a provider of high-value experience services in a bid to attract more investors.

It said an enhanced value proposition would also help emphasize the country’s differentiated capabilities and make opportunities in IT-BPM more appealing to prospective investors and employees, as well as future talent.

“There are more than a handful of investors who have actively been considering the Philippines. In the past year, our office has been busy entertaining and responding to investor interest, which resulted in our being quite bullish about our near and medium term prospects,”Madrid said.

“So there’s absolutely no shortage of interest in providing offshoring work to the Philippines,” Madrid said.

However, he acknowledged that competition has also gotten more fierce because of this pent up demand for offshoring.

“I think, as I mentioned earlier, cost is just one factor, it is an important factor, but I think I would always have to go back to the challenge of talent as another investment criteria for us to work on,”Madrid said.

Asked on the impact of the weakening Philippine peso to the US dollar, Madrid said at the base level this would be in favor of that cost of optimization in the Philippines relative to other destinations.

“At the immediate level it would appear that this would favor the cost competitiveness of Philippines IT-BPM players, but it is not the only factor,”Madrid said.

Madrid said the component of talent and the quality of talent and employability of talent as an investment consideration is more critical.

On Tuesday, the Philippine peso continued to slump to a new all-time low of P58.99 to $1.