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Why Outsource To The Philippines

Business process outsourcing is when businesses find it more cost efficient to outsource jobs to overseas countries where salaries are usually lower. The business can then retain a greater profit potential. In the past, jobs were shipped to India and other parts of Southeast Asia. Recently the media annual salary of a working professional in countries like India have been steadily rising. This means businesses now have two choices: pay more or find a smaller market to outsource their jobs to again. This article will focus on outsourcing to the Philippines and the benefits of doing so.

One major benefit for U.S. companies to outsourcing to the Philippines is the cultural compatibility that exists between the two countries. Because the United States occupied the Philippines during the years between 1899 and 1946, much of the Philippines is acquainted with the English language. Therefore there is no language barrier. The Filipino government has even thought of making English the official language of the country. Also much of the TV and movies that are shown in the Philippines are from the Western nations.

Another advantage of outsourcing from the Philippines is the relatively low cost. In the United States, even a college graduate can start out at a whopping $300 a month. That’s what the average minimum wage worker in the U.S. makes if he works full-time. The minimum wage in the Philippines is only $8 a day versus the $8 an hour in many of the states in America.

Also the Philippines have a very high literacy rate of about 92%. It is surprising that the economy is so weak there. This is why many Filipinos leave to go to other countries to find work. For American business as well as those in the United Kingdom, they can save up to 40% of business costs through business process outsourcing. This is because the costs associated with managing a business team in the U.S. and the U.K. are a lot higher due to the higher standard of living. The higher standard of living is also why India and other parts of Southeast Asia are no longer considered to be an offshore haven because of the rising salaries of the average worker.

So for now, the business process outsourcing is booming in the Philippines. There are many benefits to this thanks to the cultural compatibility. Although there is the strong possibility that eventually, like the rest of the world, salaries will eventually begin to rise here to level out globally.