Outsourcing Firms: Growth or Labor Exploitation?

Share this post


With the continuous retrenchment experienced by most companies, outsourcing firms have become the “landing posts” of many displaced workers and of fresh graduates, as well. With the boom of the outsourcing industry, more and more positions are being opened to new graduates who are proficient in utilizing the English language and capable of providing high-quality professional services.

Office desk with headset and supplies

Hello Joe

Due to the comparatively high basic salary offered by most outsourcing firms, particularly call centers, new graduates often target call center agent positions as an initial option for employment. Regardless of degree, call centers or outsourced contact service companies can absolutely hire anyone with an emphatic command of spoken and sometimes, written English.

A call center is a company that provides communication and support services for bigger companies. Call centers handle customer inquiries, complaints, and provide technical support for different products and services involving insurances, electronics, advertising, telecommunications, e-mail management, and even charity work.

Other services of outsourcing firms include legal process outsourcing, which offers legal and consultancy services, while knowledge process outsourcing (KPO) caters to knowledge and information-related decisions made by its employees.

The Philippines’ Edge

Jobs in call centers are highly prolific in the Philippines. The country’s population of English-adept professionals make them a perfect candidate to become part of any high-paying outsourced contact service solutions brought up by market leaders situated in the United States, Australia, and United Kingdom.

Aside from the country’s talented roster of English-speaking manpower, the Philippines is also proud of its powerful telecommunication infrastructure.

Money Matters

With the attractive compensation offer that call centers and outsourcing firms offer, a fresh graduate cannot resist a salary minimum ranging from P20,000 to P40,000. These rates are higher compared to the  paychecks that an ordinary employee receives. For instance, an entry-level employee working in a local company receives a minimum of $160 (Php8,000); a bank teller gets about $150 (Php7,500); an office assistant around $140 (Php7,000).

Call center agents also receive financial packages such as signing and performance bonuses.

The “sunny side” of the industry

Branded as the “sunshine industry” of both the government and the business sectors, outsourcing firms continue to expand its reach over the Philippine economy in an effort to create more employment opportunities and territorial investments.

Outsourcing firms are continuously building more establishments, which will not only give focus to Metro Manila as the country’s central hub for employment, the plan is to give rise to other locations capable of rendering outsourced services.

The Philippine government has declared 10 new, possible locations called as the “next wave cities” as areas that will house outsourcing hubs in the country. Provinces and cities like Iloilo, Bacolod, Pampanga, Davao, Angeles/Clark/ Mabalacat/ Dau, Cagayan de Oro, Malolos/Calumpit, Metro Cavite, Baliuag/ Marilao/ Meycauayan, Lipa, and Metro Laguna were considered as the top locations for outsourcing firms where they could invest and set up their establishments.

Curriculum Adjustments

Although the country is home to almost close to a half-million English-speaking students, only a few can enter and support the needs of the industry. Only 5% of 380,000 graduates qualify as call center agents.

To increase the number of potential call center employees and encourage more individuals to work for the BPO industry, government agencies have created training centers which will develop English-speaking individuals, proficient transcriptionists, and adept IT professionals aimed to serve foreign investors in the country. Moreover, these training centers were establish to provide formal training and certification to individuals who wanted to venture into the outsourcing industry but still lack the skills and qualifications needed.

The Technical Education and Skills Authority (TESDA) have provided a number of scholarship programs for aspiring call center professionals, and increase the probability of its students to earn a spot in the very populated industry called call centers.

Gratification or Exploitation

Call center agents in the Philippines often receive questionably low wages as compared to their foreign counterparts. For instance, a Filipino telemarketer earns an annual salary of $3,964, while agents stationed in Singapore performing the same job earns at $16,884.

Another issue that local call center agents find very disturbing is how each and one of them is strictly-monitored for performance countermeasures. Employee turnover in this industry is unusually high due to productivity target a certain employee must cordially meet.

Moreover, there are also issues concerning health and safety of the employees working for the BPO industry. The shifting schedule makes it hard for the employee to perform at a high and competitive level.

The government needs to address the situation in order to protect its workforce from financial abuse and health-related syndromes formed when working in different foreign time zones.