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IT-BPM sector grows, short of program

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THE INFORMATION TECHNOLOGY and business process management (IT-BPM) sector, the country’s chief dollar earner aside from overseas Filipino worker remittances and also a key driver of property development, saw “signs of recovery last year” even as job growth fell short of target, the IT & Business Process Outsourcing Association of the Philippines (IBPAP) said in a statement last weekend.

The group said direct employment “grew by 5.1%” to “1.23 million employees” last year.

IBPAP did not give revenue data. The government estimates that the industry’s revenues grew by about 12.3% in 2017, year-on-year.

“While we saw signs of recovery in 2018, this was slower than the eight percent annual growth projected in our Roadmap 2022,” IBPAP said in its press release.

In that road map, the group targets to achieve by 2022 — when President Rodrigo R. Duterte ends his six-year term — $40 billion in revenues (from about $22.5 billion in 2017), 1.8 million direct jobs, 500 jobs outside Metro Manila, 7.6 million direct and indirect employment and a 15% global IT-BPM market share.

“Although a missed opportunity to generate more jobs overall, there was strong performance by new locators, which offered a wider range of higher-end services, e.g. from customer service to e-commerce, supply chain management, IT infrastructure support and analytics,” the IBPAP added.




The group cited “strengthened partnerships” with the Department of Education, the Commission on Higher Education, the Department of Labor and Employment and the Technical Education and Skills Development Authority in order to address “the need for a solid talent upskilling and reskilling… to ensure that we are equipped with the right skills needed and for promoting the health and safety of our talent.”

At the same time, the group’s members and locators in economic zones in the country face prospects of a changing fiscal incentives regime as the Finance department moves to plug billion of pesos in foregone revenues from what it says are redundant tax perks.

That tax reform was designed to be approved in tandem with a proposal to slash the corporate income tax (CIT) rate to 20% by 2029 from 30% currently in order to put it at par with those across Southeast Asia, but lawmakers have proven hesitant to cut tax incentives even as they favor the CIT cut. — Janina C. Lim

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