A fresh wave of downsizing at large US financial holding companies is expected to benefit the country’s booming business process outsourcing (BPO) sector especially those located in Manila.
House Deputy Majority Leader Roman Romulo gave this observation in a statement amid US banks plans to cut jobs later this year.
“American banks will likely accelerate the transfer of more back offices and business support jobs to lower-cost locations such as the Philippines in the months ahead,” said Romulo in a statement.
“It appears they are still under a lot of pressure to slash costs to stay profitable. Amid a sluggish US economy, there are estimates American banks may shed another 150,000 jobs this year.”
Romulo is a key supporter of the information-technology (IT)-enabled BPO sector.
Romulo’s remark also came after the Bank America Corp. (BA), the second largest US financial holding company, with global assets of $2.2 trillion, announced its plans last Sept. 27 to cut another 16,000 US jobs by year’s end.
The job cuts would see Charlotte, North Carolina-based BA giving up its title as the US banking industry’s largest employer.
According to Romulo, BA was founded in 1904 and operates in more than 40 countries with over 282,000 employees, mostly in the US.
Like its three biggest rivals—JPMorgan Chase & Co., Citigroup Inc. and Wells Fargo & Co.— he said that BA already had a global in-house center (GIC) in Manila providing a wide range of non-core, business support activities.
“Taguig City-based BA Continuum Philippines Inc. “provides back-office operations and transactions, customer support and service functions, technology support and services, general human resource functions, business planning and general financial services,” he said.
Meanwhile, Romulo cited the rise of two new IT Parks in Pasig City, would provide the extra infrastructure and connectivity required to boost the BPO sector’s solid growth.
BPO firms are the primary locators in tax-sheltered IT parks registered with the Philippine Economic Zone Authority.
The PSMT IT Building and Reliance IT Center in Pasig are among the 22 new IT parks being developed throughout the National Capital Region.