The Philippines has become a popular destination for this practice due to its large English-speaking workforce and relatively low labor costs.
However, as attractive as it may seem, offshore staffing in the Philippines is not without its drawbacks like difficulties to keep up with the US demand and reach the high-quality level required.
In this article, we will explore some of the reasons why many businesses choose to hire offshore positions in the Philippines and why they should consider South America as a better option.
Why Businesses Choose Offshore Staffing in the Philippines
According to a report by Tholons, a global strategic advisory firm, the Philippines ranked second in the world in terms of digital competitiveness and innovation in 2020. The country has a thriving business process outsourcing (BPO) sector that offers services such as customer service, telemarketing, technical support, data entry, accounting, web development, software development, and more.
Some of the benefits of offshore staffing in Philippines are:
- Cost savings: Regularly businesses can save from 40-50% on labor costs by hiring offshore staff compared to hiring local staff in their home countries. When it comes to Philippines professionals this number can jump up to 70% in some cases.
- Talent pool: The Philippines has a population of over 100 million people, of which 43.9% are between 25 and 54 years old. This means that there is a large pool of potential workers who are young, educated, skilled, and motivated. The country also has a high literacy rate of 98.2% and a high English proficiency level of 60.33%, ranking 20th out of 100 countries.
- Culture: The Philippines has a culture that is influenced by both Western and Eastern values. Filipinos are known for being friendly, hospitable, respectful, adaptable, and hardworking. They also share some common traits with Americans such as being individualistic, optimistic, competitive, and consumer-oriented.
Why Businesses Could Consider South America Instead
While offshore staffing in Philippines may seem like a good idea for some businesses, it may not be the best option for others. There are some disadvantages and challenges that businesses should be aware of before deciding to outsource their work to the Philippines. Some of these are:
- Quality issues: While there are many talented and qualified workers in the Philippines, there are also many who are not. Some offshore staff may lack the necessary skills, experience, or training to perform their tasks effectively. They may also have poor work ethics, attitudes, or habits that affect their productivity and quality of work.
- Communication issues: Although English is widely spoken in the Philippines, there may still be some language barriers or misunderstandings between offshore staff and their clients or managers. Some offshore staff may have strong accents, grammatical errors, or limited vocabulary that make it difficult for them to communicate clearly or professionally. There may also be cultural differences or nuances that affect the way they interpret or convey messages.
- Political issues: The Philippines is a developing country that faces some political instability and corruption. The country ranks 115th out of 180 countries in the Corruption Perceptions Index 2020 by Transparency International. The country also has some ongoing conflicts with China over territorial disputes in the South China Sea. These factors may affect the business environment and security of offshore staff in the Philippines.
Given these drawbacks and challenges, businesses may want to consider other alternatives for offshore staffing. One of them is South America, a continent that offers many advantages for offshore staffing, like:
- Cost savings: Similar to the Philippines, South America also offers lower labor costs than many developed countries. For example, the average monthly salary of an offshore worker in Brazil is around $700, while the average monthly salary of an offshore worker in Colombia is around $400.
- Talent pool: South America has a population of over 400 million people, of which 66.8% are between 15 and 64 years old. This means that there is a large pool of potential workers who are young, educated, skilled, and motivated. The continent also has a high literacy rate of 92.9% and a high internet penetration rate of 72.4%.
- Time zone: South America is in the same or similar time zone as many North American and European countries. For example, Brazil is only one hour ahead of New York and four hours behind London. This makes it easier for businesses to coordinate with their offshore staff and customers in these markets.
- Culture: South America has a culture that is influenced by both Western and Latin American values. South Americans are known for being friendly, hospitable, respectful,
adaptable, and hardworking. They also share some common traits with Americans such as being individualistic, optimistic, competitive, and consumer-oriented.
Why your next hire should come from South America
Offshore staffing in the Philippines is a popular option for many businesses that want to save costs and access a large pool of English-speaking workers. However, it also comes with some risks and challenges that businesses should be aware of before making a decision.
South America is another option that businesses should consider for offshore staffing. It offers many benefits such as lower labor costs, a large pool of skilled workers, a favorable time zone, and compatible culture.
If you are looking for an offshore staffing agency that can help you find the best talent in South America, you can contact us at [insert agency name and contact details]. We have years of experience in providing offshore staffing solutions for various industries and functions. We can help you hire, manage, and retain your offshore staff in South America with ease and efficiency.
References:
Offshore Staffing Philippines: Here’s Everything You Need to Know - KDCI. https://www.kdci.co/blog/offshore-staffing-philippines/
Tholons Services Globalization Index (TSGI) 2020. https://tholons.com/wp-content/uploads/2020/10/Tholons-Services-Globalization-Index-TSGI-2020.pdf
The top 11 offshore staffing agencies to consider - Time Doctor. https://www.timedoctor.com/blog/offshore-staffing-agencies/
Average Salary in Philippines 2021. https://www.salaryexplorer.com/salary-survey.php?loc=171&loctype=1
Philippines Population (2021) - Worldometer. https://www.worldometers.info/world-population/philippines-population/
EF English Proficiency Index - Philippines. https://www.ef.com/wwen/epi/regions/asia/philippines/
Cultural Differences Between Americans & Filipinos. https://bizfluent.com/info-12041521-cultural-differences-between-americans-filipinos.html
The Pros And Cons Of Outsourcing To The Philippines. https://www.forbes.com/sites/forbesbusinesscouncil/2020/06/03/the-pros-and-cons-of-outsourcing-to-the-
