Offshoring industry to account for 10 percent of GDP by 2030 – study

MANILA, Philippines — The country’s offshoring industry is projected to contribute up to $61 billion or P3.45 trillion to the economy by 2030, driven by growing demand for Filipino talent by foreign firms, according to a study by a global recruitment firm.

In its latest research, Robert Walters estimated that the local offshoring industry would contribute at least 10 percent to gross domestic product (GDP) by the end of the decade.

The projected economic contribution is 69 percent higher than the current worth of the Philippine offshoring industry at around $36 billion, according to Robert Walters. At present, the industry contributes around 8.23 percent of GDP, it added.

Aside from the economic contribution, the growth of the offshoring industry is expected to create more than 969,000 skilled jobs over the next five years as international companies continue to establish operations in the country to access professional talent, Robert Walters said.

The company defines offshoring as the practice of relocating business processes or services overseas that organizations undertake to achieve cost efficiencies, streamline operations and gain access to a wider pool of skilled talent.

“To put the $61 billion figure into perspective, that’s more than three times the Philippines’ annual education budget,” Robert Walters’ head of market intelligence Phill Brown said.

“Offshoring is becoming a long-term economic driver for the Philippines and underscores the growing confidence in the country’s skilled workforce and its ability to support critical, global-facing business operations,” Brown said.

The company pointed out that there has been a shift in the global offshoring landscape toward a focus on tapping skilled international workforces, veering away from cost-saving and volume efforts.

Robert Walters emphasized that the country’s high English proficiency is one of the key factors driving the growth of the local offshoring industry.

This has been heightened by the Filipino talents’ specialization technology and information services as well as growing pool of digital infrastructure and engineering talent, according to the firm.

The global talent solutions firm noted that the most in-demand skills today in offshoring are backend programming, cloud engineering and IT security.