EUROPE – The results of the Global Value Chains (GVC) survey covering 2021–2023 are out, and the study found that cost efficiency remains the primary driver of European companies’ global outsourcing: 34.1% say it reduces labor costs, while 27.8% say it reduces other costs.
According to GVC, 72.8% of EU companies have outsourced a mix of their core and support functions to other EU countries. For those that outsource outside the EU, their top choices are India (18.6%) and the U.K. (17.1%).
The top business functions they outsource are:
- Administrative and management
- Information and communication technology services
- Production of goods and materials
- Marketing, sales, and after-sales services
- Other services
A Market Opportunity for the PH IT-BPM
As EU companies continue to seek cost efficiency in outsourcing, this creates an opportunity for the Philippines’ IT-BPM industry to present itself as a compelling alternative to India and the U.K., with its strong talent pool, competitive labor costs, and proven track record in global outsourcing.
In addition, the expansion into the EU market provides the industry with a strategic buffer against U.S. policies such as the Keep Call Centers in America Act and the $100K H-1B worker fee.
Not only does this move reduce the industry’s dependence on the U.S. market, but it also opens new revenue streams and strengthens its resilience as a global outsourcing hub.
