This Special Release highlights the results for Information Technology - Business Process Management (IT-BPM) sector based on the special tabulation done for the 2017 Annual Survey of Philippine Business and Industry (ASPBI) final results. IT-BPM sector covers selected industries in the Information and Communication (Sector J) and Administrative and Support Service Activities (Sector N).
TABLE A Comparative Summary Statistics for Information Technology - Business Process Management (IT-BPM) Establishments: Philippines, 2017 and 2016
Computer programming activities industry posts the highest number of establishments
A total of 1,532 establishments comprised the IT-BPM sector in 2017, an increase of 2.4 percent compared with the 1,496 establishments recorded in 2016. Among the industries, computer programming activities contributed the highest share of 35.2 percent to the total number of IT-BPM establishments. This was followed by customer relationship management activities, and sales and marketing (including telemarketing) activities with shares of 23.0 percent and 9.8 percent, respectively.
Figure 1 shows the percentage distribution of the number of establishments for IT-BPM sector by industry sub-class in 2017.
Customer relationship management activities industry employs majority of the total number of workers
A total of 644,051 workers were engaged in IT-BPM activities in 2017, an increase of 5.6 percent compared with the 609,808 workers reported in 2016. Of the total employment, 99.98 percent were paid workers and the rest were working owners and unpaid workers.
Customer relationship management activities employed the highest number of workers of 435,448 (67.6%). This was followed by sales and marketing (including telemarketing) activities and computer programming activities with 84,581 workers (13.1%) and 40,646 workers (6.3%), respectively.
Figure 2 shows the distribution of employment for IT-BPM sector by industry sub-class in 2017.
Average annual compensation reaches PhP406.0 thousand per employee
The total compensation paid by IT-BPM sector amounted to PhP261.4 billion in 2017, which translates to an average annual compensation of PhP406.0 thousand per employee. Compared with the average annual pay of PhP380.6 thousand per employee in 2016, this amount indicates an increase of 6.7 percent.
Employees of software publishing received the highest average annual compensation of PhP1,090.5 thousand per employee. This was followed by employees of finance and accounting activities with an average annual compensation of PhP824.2 thousand and engineering outsourcing activities with PhP761.3 thousand per employee.
Figure 3 shows the average annual compensation of employees for the top five industries of IT- BPM sector by industry sub-class in 2017.
Customer relationship management activities industry contributes the biggest share to total income and expense
IT-BPM sector generated a total income of PhP567.0 billion and incurred a total expense of PhP485.1 billion in 2017. These amounts represent an annual growth of 16.3 percent and 15.7 percent, respectively, relative to their values in 2016.
Industry-wise, customer relationship management activities recorded the highest income of PhP307.3 billion or 54.2 percent of the total income. This was followed by computer programming activities, and sales and marketing (including telemarketing) activities with PhP89.5 billion (15.8%) and PhP65.7 billion (11.6%), respectively.
Being the highest contributor to total income, customer relationship management activities also recorded the highest expense of PhP270.8 billion or 55.8 percent of the total. In second and third place were computer programming activities with expense of PhP78.4 billion (16.2%), and sales and marketing (including telemarketing) activities, PhP55.4 billion (11.4%).
Figure 4 shows the top five industries in terms of income and expense of IT-BPM sector by industry sub-class in 2017.
In 2017, IT-BPM sector recorded an income per peso expense of 1.17. This means that for every peso spent, a corresponding income of PhP1.17 was generated by the sector. Compared with the income per peso expense of 1.16 in 2016, this indicator increased by 0.9 percent.
Industry-wise, application hosting services recorded the highest income per peso expense of 1.87. This was followed by data processing with an income per peso expense of 1.73.
Gross additions to tangible fixed assets totals to PhP9.3 billion
Gross additions to tangible fixed assets (capital expenditures less sale of fixed assets) acquired by IT-BPM sector totaled to PhP9.3 billion.This was lower by 39.5 percent than the PhP15.3 billion gross additions to tangible fixed assets in 2016.
Among the industry sub-classes, customer relationship management activities acquired more than half (50.4%) of the total gross additions to tangible fixed assets.
Government grants PhP9.3 billion subsidy
The government granted PhP9.3 billion subsidy to IT-BPM sector in 2017. The highest allocation of PhP9.1 billion was granted to customer relationship management activities. The following industries also received subsidies in 2017:
- Sales and marketing (including telemarketing) activities, PhP145.6 million
- Other call centers activities (voice), n.e.c., PhP110.0 million
- Finance and accounting activities,PhP1.9 million
- Medical transcription activities, PhP1.0 million
Income from transactions outside the country increases by 5.7 percent
In 2017, IT-BPM sector earned a total of PhP196.3 billion from transactions outside the country or 34.6 percent of the total income. This represents an increase of 5.7 percent from the PhP185.8 billion income in 2016.
Among the countries, the United States of America (USA) had the highest share of 65.7 percent to the total income from transactions outside the country.
Figure 5 shows the percentage distribution of income from transactions outside the country for IT-BPM sector by country in 2017.
Industry-wise, customer relationship management activities had the highest income from transactions outside the country of PhP136.2 billion (69.4%). This was followed by sales and marketing (including telemarketing) activities, and computer programming activities with PhP28.2 billion (14.4%) and PhP14.6 billion (7.4%), respectively.
Figure 6 shows the top five industries in terms of total income and income from transactions outside the country of IT-BPM sector by industry sub-class in 2017.
(Sgd.) ROSALINDA P. BAUTISTA
Deputy National Statistician
Sectoral Statistics Office
Scope and Coverage
The Annual Survey of Philippine Business and Industry (ASPBI) was conducted in 2018 to collect information on the structure and trends of economic activities in the entire country for the year 2017. The survey covered establishments engaged in economic activities as defined under the 2009 Philippine Standard Industrial Classification (PSIC).
These establishments were classified into 18 different sectors of the economy, two of which are Information and Communication (Sector J) and Administrative and Support Service Activities (Sector N). Selected industries in a special tabulation for these two sectors comprised the Information Technology – Business Process Management (IT-BPM), as listed below:
The response rate for IT-BPM sample establishments was 87.1 percent (1,650 out of 1,895 establishments). This included receipts of "good" questionnaires, partially accomplished questionnaires, reports of closed, moved out or out of scope establishments.
Of the total responses, 55 establishments responded online.
Reports of the remaining non-reporting establishments were taken from financial statements from Securities and Exchange Commission (SEC) and other available data sources. Reports of establishments which were found to be duplicate of another establishment’s report, out-of-scope, and out of business in 2017 were not included in the generation of statistical tables.
Limitation of Data
The survey covered only the formal sector of the economy.
Concepts and Definition of Terms
Establishment is an economic unit which engages under a single ownership or control, i.e. under a single legal entity, in one or predominantly one kind of economic activity at a single fixed location. It is also defined as the unit that is engaged in the production of the most homogenous group of goods and services, usually at one location, sometimes over a wider area for which separate records are available that can provide data concerning the production of these goods and services and the materials, labor and physical resources used in the production.
Economic activity or business is the activity of the establishment as classified under the 2009 Philippine Standard Industrial Classification (PSIC). The main activity refers to the activity that contributes the biggest or major portion of the gross income or revenue of the establishment.
Computer and related activities establishment is an office or firm engaged in hardware consultancy, software publishing, software development, data processing, database activities and on-line distribution of electronic content, maintenance and repair of office, accounting and computing machinery and others.
Miscellaneous business activities establishment is an office or firm engaged in legal, accounting, bookkeeping and auditing; tax consultancy; market research and public opinion polling; business and management consultancy; architectural and engineering activities; land surveying services; technical and testing analysis; advertising; labor recruitment and provision of personnel; investigation and security services; cleaning of buildings of all types; pest control services; industrial cleaning activities; photographic activities; packaging activities; management and administrative services; bill collecting and credit rating services; business brokerage; stenographic, duplicating and mailing activities; fashion design; interior decoration services; call center activities; medical transcription and others.
Business Process Outsourcing (BPO) is the leveraging of technology or specialist process vendors to provide and manage an organization’s critical and/or non-critical enterprise processes and applications.
Outsourcing (or contracting out) is the delegation of non-core operations or jobs from internal production within a business to an external entity (such as a subcontractor) that specializes in that operation. Outsourcing is done to save money, improve quality, or free company resources for other activities. Outsourcing was first done in the data-processing industry and has spread to areas, including telemessaging and call centers.
Offshore outsourcing is the practice of hiring an external organization to perform some or all business functions in a country other than the one where the product or service will be sold or consumed.
Computer consultancy and computer facilities management activities includes planning and designing of computer systems that integrate computer hardware, software and communication technologies
Software Publishing includes publishing of ready-made (non-customized) software: operating systems, business and other applications, computer games for all platforms
Computer programming activities includes the activities of writing, modifying, testing, and supporting software, designing the structure and content of, and/or writing the computer code necessary to create and implement: systems software (including updates and patches), software applications (including updates and patches), databases, web pages; customizing of software, i.e., modifying and configuring an existing application so that it is functional within the client's information system environment
Data Processing includes complete processing of data supplied by the customer, data entry services, scanning of documents, time share computer services etc.
Database Activities and On-line Distribution of Electronic Content some of the activities included in this group are compilation of data from one or more sources, on-line data base publishing, internet search sites, electronic learning are examples of the activities undertaken
Other Computer Related Activities includes computer disaster recovery, software installation services
Call centers activities (Voice) includes inbound call centers, answering calls from clients by using human operators, automatic call distribution, computer telephone integration, interactive voice response systems or similar methods to receive orders, provide product information, deal with customer request for assistance or address customer complaints; outbound call centers using similar methods to sell or market goods or services to potential customers, undertake market research or public opinion polling and similar activities for clients
Motion picture, video and television programme activities and post-production activities includes production of theatrical and non-theatrical motion pictures whether on film, video tape, DVD or other media, including digital distribution, for direct projection in theatres or for broadcasting on television; supporting activities such as film editing, cutting, dubbing etc.; distribution of motion pictures or other film productions (video tapes, DVD's etc.) to other industries; as well as their projection. Buying and selling of motion picture or any other film production distribution rights is also included. It also includes production of motion pictures, videos, television programmes or television commercials. Post production activities such as: editing, film/tape transfers, titling, subtitling, credits closed captioning, computer-produced graphics, animation and special effects film/tape transfers Activities of motion pictures film laboratories and activities of special laboratories for animated films: developing and processing motion picture film, activities of motion picture film, reproduction of motion picture film for theatrical distribution
Total Employment is the number of persons who worked in or for the establishment as of November 15, 2017.
Paid employees are persons working in the establishment receiving regular pay as well as those working away from the establishment when paid by and under the control of the establishment. Included are persons working as full-time or part-time and those employees on sick leave, paid vacation or holiday. Excluded are consultants, home workers and workers receiving commission only.
Unpaid workers include working owners who do not receive regular pay, apprentices and learners without regular pay, and persons working without regular pay for at least one third of the working time normal to the establishment.
Compensation is the sum of salaries and wages; separation, retirement, terminal pay, gratuities and others; and employer’s contribution to SSS, GSIS, etc.
Salaries and wages are gross payments made by establishments to its employees in cash or in kind, that is, prior to deduction for employee’s contribution to SSS/GSIS, withholding tax, etc. Included are total basic pay; vacation, sick and maternity leave pay; overtime pay and other benefits.
Employer’s contribution to SSS, GSIS, etc. includes contribution to Employees Compensation Commission (ECC), Philhealth, PAG-IBIG, etc.
Income refers to cash received and receivables for goods/products and by-products sold and services rendered.
Expense refers to cost incurred by the establishment during the year whether paid or payable. This is treated on a consumed basis.
Fixed assets are physical assets expected to have productive life of more than one year and intended for use and/or being used by the establishment. Included are land, buildings, fixtures, machinery, tool, furniture, office equipment, vehicles, and the like.
Gross additions to fixed assets refer to the difference between the cost of acquisition of fixed assets acquired in 2017 and the value of sales of fixed assets during the year.
Capital expenditures refer to the cost of acquisition of fixed assets acquired in 2017 whether or not full payments have been made.
Change in inventories is equivalent to the value of inventories at the end of the year less the value of inventories at the beginning of the year.
Inventories refer to the stock of goods owned by and under the control of the establishment as of a fixed date, regardless of where the stocks are located. Valuation is at current replacement cost in purchaser prices. Replacement cost is the cost of an item in terms of its present price rather than its original cost.
Subsidies are all special grants in the form of financial assistance or tax exemption or tax privilege given by the government to aid and develop an industry.
Valued added is gross output less intermediate input. Gross output is the sum of the total income (less interest income, rent income from land, dividend income, royalty income and franchise income), capital expenditures of fixed assets produced on own account and change in inventories. Intermediate input is equal to the sum of the following cost items: materials and supplies purchased; fuels, lubricants, oils and greases purchased; electricity purchased; water purchased; cost of industrial services done by others; cost of non-industrial services done by others; goods purchased for resale; research and development expense; environmental protection expense; royalty fee; franchise fee; payouts and other cost.