An update – What’s happening in the Philippines.
TIME YOUR HUNT FOR NEW PEOPLE
Second week in December every employee in the Philippines get a Month’s pay, on top of their normal pay. This is is called the 13th Month Pay. Whilst it’s nice for the worker, it actually disrupts the job market. If you are head hunting (or employing people currently employed) between now and December, it’s very difficult to get them to leave, aside from the fact not many are looking around this time of the year as well. Of course, from December on, there’s a surge of employment changing, so it’s a better time to look for those higher end productive people. Time your recruitment for better results. NOTE: if you are after people already in the market, you will NOT be overly affected by the 13th Month Syndrome.
These past 12 months I’ve seen more Filipinos hired on more than 100,000PHP a month than ever – in fact 3 years ago if you told me Filipinos will be often paid +100,000PHP I would have laughed at you.
100,000PHP a month equals $635AUD a week or $460USD a week. Here’s the kicker, the level of skill and experience attracting these wages, in the West would be around $2500 a week. So, there’s still a sizable gap, therefore lots of business opportunities.
Are wages going up? Yes and No. What’s going up is EXPERIENCE. The use of more proactive multi skilled people has now been the significant trend for 8-10 years. As a result, we are seeing are lot more experienced applicants – and these people are getting the big money.
Entry level wages have stayed relatively flat. In Manila 25,000PHP, and in Clark 18,000PHP are common wage levels for most workers. That’s $158AUD / $115USD a week in Manila, and $114AUD / $83USD a week in Clark.
Of course, it’s shortages and the market that are driving up the experienced wages. Finding these workers can be challenging – most are obviously not on the job market which means creative headhunting is the game. The trick is to use a competent service to find these people.
If you are struggling with low waged workers, perhaps a chat around what more experienced people might be available, is appropriate.
SUPPORT INDUSTRY TRENDS
The Corporate Outsourcing Industry, as established 25 years ago, remains the biggest player in the Offshoring Industry. Growth in this sector has stalled. This is due to A.I., market saturation, and customers leaving and Incorporating directly.
Staff Leasing, now about 10 years old, is expanding – in terms of offers (co-managed) and market share – as more and more smaller businesses enter the Offshoring Market. The Education process is struggling to keep up with the changing needs of the businesses. Many providers are stepping in to bridge the education gap.
Traditional Outsourcing is on the rise. I’m witnessing more specialised services entering the market in Accountancy, Marketing and I.T. Engineering and Law are also showing signs to activity. I see mixed results, with the passing of in-depth details from client to the service being the limiting factor.
Home based growth seems to have slowed. Several platforms increased their rates, which appears to have fragmented the market. Even with time tracking etc homebased seems to falter when the team numbers grow.
A big entrant into Offshoring is in Online Start-ups. The concept of bootstrapping a Startup with the entire team in one workplace, sharing and developing the Tacit Knowledge needed to fuel the business is becoming very viable. I’m seeing hundreds of interesting Start-ups thriving in the Offshore Market.
It’s my belief that an international “market adjustment”, possibility soon, will feed more start-ups into Offshoring.
CLIENTS ARE A WAY BIGGER PROBLEM THAN THE WORKERS
A bold statement for sure. Every Offshoring Service shares this observation with me. Many Offshoring failures are caused by the CLIENTS failing to understand what their third-party service provides and their workers capabilities. Interestingly I hear lots of comments that clients seem to lack the fundamentals of managing people.
IF you are developing a team in the Philippines MANAGING them is almost the SAME as at home. You need to lead them, be clear with what is expected. Empower them to make decisions in their role, encourage and praise frequently.
It’s critical (Filipinos love this) that you set achievable KPI’s and Manage to those KPI’s.
OCTOBER MIKESBUSINESSTOURS is FULL – NOVEMBER LAST THIS YEAR
I’m been running a few private Tours recently. At the time I wrote this, my next 3-day tour is October 22 which has very limited space.
Following this my only available 3 day tour this year, is November 6-8. Yes, a Tour that starts on a Tuesday and finishes on the Thursday.
Email me – email@example.com if you are interested in giving your business model a boost while leaning all the tips and tricks to Offshoring.
Click here to find out more about my Business Learning Tour.
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WANT TO WORK IN THE PHILIPPINES? An Australian owned Offshoring service based, in the Clark Freeport Zone in Pampanga, Philippines is seeking experienced, effective people and process MANAGERS. We are talking expats either currently in the Philippines, or willing to relocate to the Philippines. If YOU are an effective People Manager, then a quiet chat with me may be worthwhile.