US in-sourcing push underscores clamor to end call center-centric and foreign investment-driven economy – CPP

Press Release
January 10, 2012

MANILA  –  The Communist Party of the Philippines (CPP) cited the push in the United States to in-source call-center jobs of American companies, saying it underscores the clamor of the Filipino workers and people to put an end to the call center-centric and foreign investment-driven local economy and uphold policies for national industrialization and land distribution to spur domestic economic production and demand.

The Obama government is supporting the Call Center and Consumers Protection Bill filed in the US Congress which encourages in-sourcing of call center jobs by American firms and penalizing companies that deal with business process outsourcing (BPO) firms overseas.

Aquino government officials fear that the enactment of the in-sourcing law in the US will stymie the growth of the local BPO enterprises in the Philippines, touted as the “sunshine industry”. Last year, the Philippines surpassed India in call-center employment. Local BPO operations employ around 600,000 Filipinos with 70% employed in call centers. As much as 90% of listed available jobs in the Philippines are those for call center positions. Local call center agents receive an annual average pay of $3,600 compared to the annual pay of $30,000 for American workers.

“Local BPO operations are bound to suffer the fate of export-oriented textile and electronics production which eventually slowed down from its peak in the 1980s after foreign investors eventually found labor markets that were cheaper than the Philippines,” said the CPP.

“The increasing possibility of massive retrenchment in BPO centers in the Philippines in the face of the US push for in-sourcing drives down the basic criticism against the economic policy of dependence on foreign investments,” said the CPP.

“The Aquino government, like all past regimes since the 1940s, has advocated the policy of attracting foreign investments as the main engine of economic growth. The slowdown and eventual demise of the BPO industry in the Philippines, like all previous so-called ‘sunshine’ industries, emphasize the fact that foreign investments have never brought long-lasting growth to the Philippines.”