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Local IT and IT-Enabled Service Industry Remains Resilient in 2007-2008


The Philippine IT and IT-enabled service industry remained resilient amidst the global financial crisis, as shown by the results of the 2007-2008 BSP Survey on the industry. The total revenue of the industry was estimated at US$6.3 billion in 2008, higher than the reported US$4.4 billion revenue in 2007. The industry continued to grow at a rapid double-digit rate (44.8 percent), although this was slightly lower than the 50.3 percent growth in 2007. Among the IT-enabled service categories, the “other BPOs” posted the highest growth in revenue in both 2008 (73.2 percent) and 2007 (66.0 percent), indicating that the local outsourcing industry has shifted towards more value-added chain activities.1 

IT-enabled services exports rose by 51.5 percent to reach US$5.3 billion in 2008, from the 2007 level of US$3.5 billion. Export earnings comprised about four-fifths of total industry revenues in 2008 and 2007.  All sub-sectors reported that more than 70.0 percent of their revenues were sourced from exports, with the animation sub-sector having the highest export-to-revenue ratio of  95.8 percent in 2008.

Total equity investments in the industry amounted to US$2.0 billion as of end-2008, of which US$1.8 billion or 93.3 percent represented foreign equity participation.

Employment in the IT and IT-enabled services industry reached 355,135 persons in 2008, higher by 30.8 percent than the 271,556 employment level in 2007.  Total  compensation  paid  by  the  industry was recorded at US$2.8 billion in 2008, up by 29.7 percent from the level of US$2.1 billion in 2007. Average annual compensation per employee in the industry amounted to US$7,778 (or about P346,000) in 2008, slightly lower by 0.8 percent than the US$7,841 level in 2007.

The survey covered a total of 648 companies in 2008 from 624 in 2007.  Survey  results  were based on an overall response rate of 59.9 percent  and  55.0 percent in 2008 and 2007, respectively. Respondents included companies engaged in the operation of call centers, medical and legal transcription, animation, software development and other business process outsourcing (BPO) activities. These companies represented the different IT and IT-enabled Service Industry Associations as well as those registered with the Department of Trade and Industry (DTI)-attached agencies namely, the Philippine Economic Zone Authority (PEZA) and the Board of Investments (BOI).

  1 The “other BPOs” category includes backroom operations, data processing, data base activities and online distribution of electronic content, and the more value-added chain activities—shared financial and accounting services, hardware consultancy and outsourcing for: (i) research and public opinion polling, (ii) business & management consultancy activities, and (iii) architectural and engineering services.

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