Strong dollar fuels Philippine call center growth
MANILA, PHILIPPINES — The Philippine call center industry is experiencing significant growth, bolstered by a strong dollar and increasing wages in the United States.
According to a Bloomberg report, this growth is setting the industry on a path to becoming the nation’s top foreign exchange earner by 2026, surpassing remittances from overseas Filipinos.
Currency and cost advantages
The depreciation of the Philippine peso, which has fallen nearly 4% this year, enhances the country’s appeal as a cost-effective outsourcing destination.
“We are in the export industry and earn foreign exchange. From that point of view, it’s good to have a strong dollar,” explained Pushkar Misra, a director of the Contact Center Association of the Philippines (CCAP).
Sustained demand from the U.S. market
The U.S., the primary market for Philippine outsourcing firms, continues to see rising wages, which in turn sustains demand for outsourcing services.
CCAP President Mickey Ocampo said, “As the minimum wage rate gets higher in the U.S., it becomes more economical to outsource to the Philippines.”
He highlighted the cost-effectiveness of outsourcing, where $16 per hour could cover a full team in the Philippines compared to limited services in the US.
Sector growth and employment
The call center sector is not only a significant contributor to the Philippine economy but also a major employer.
In 2023, the industry employed approximately 1.5 million people and is looking to add another million jobs by 2028.
Companies like Accenture and American Express Co. are drawn to the Philippines for its cost advantages, cultural affinity with the West, and it’s English-speaking workforce.
Challenges and future prospects
Despite its success, the call center industry faces challenges such as the rise of artificial intelligence, cybersecurity threats, and high operational costs.
The industry is adapting by retraining workers for higher-skilled roles in sectors like banking and healthcare.
Additionally, the industry is collaborating with educational institutions to integrate necessary skills into curricula, ensuring a steady supply of qualified workers.
Investor interest in the Philippines remains strong, with new ventures from Japanese companies and ongoing discussions with Colombian groups about setting up English support services in the region.
