The Shadow of Sunshine Industry

by Karina Melencio
Image: Petr Macháček / Unsplash

The Philippines is known as the Call Center Capital of the World, with over 700 Business Process Outsourcing (BPO) companies across the nation. Since its humble beginnings in the 1990s, the BPO industry has been one of the few ‘legs’ of the Philippine economy, having contributed 9% to the country’s GDP Growth in 2017. It was greatly backed and supported by the Aquino administration, who successfully pushed for neoliberal economic development policies. The BPO industry began to be dubbed as the ‘sunshine industry’, indicating its rapid growth and future success. However, in showcasing the industry’s contributions to economic advancements, the Philippine government has failed to account for its detrimental effects on Filipinos’ cultural identity, the protection of their labor, and urban-rural income disparity.

Neocolonialism & Language Hierarchy

One of the paraded ‘advantages’ of the Philippines as an outsourced workforce is their deep and long-standing immersion in Western culture, which can be traced back to their past as a colony of the U.S.. At its core, this advantage only strengthens the utility of Filipinos’ labor because of their ability to replicate ‘American-quality’ service.

The enforcement of English and native nuances of the language upon BPO employees is one of the most prominent forms of ‘Americanization’ within the industry. The process of ‘Americanization’ is observed through most companies imposing the ‘English Only Policy’ (EOP) in an effort to improve employees’ fluency. This policy involves multiple English training sessions and workshops, particularly to ‘neutralize’ Filipino accents in order to ‘sound like native speakers’, and employees are told to follow an English script for all and any interactions with customers. 

“…the BPO industry, with its implementation of English among its employees, drives Filipinos further from their culture and national consciousness…”

The implementation of such policies  aims to disguise any trace of Filipinos’ mother-tongue, effectively discouraging and alienating employees from their own language and culture. Mitima Jean-Paul Zagabe, a Doctor of Philosophy from De La Salle University, explains in their study that the promotion of the English language diminishes other ‘weak’ or local languages. The more natives are encouraged to speak in English, the less they continue to use their own local languages. Erasure of non-native speakers’ accents when speaking in English also alienates natives from their own culture. This is due to the direct linkage between culture and language. Crucially, language is the lens through which we see and understand our reality and the world. In this way, when we adopt a new language, we also embody the culture that comes along with it. Thus, the BPO industry, with its implementation of English among its employees, drives Filipinos further from their culture and national consciousness, taking on a more Americanized view and way of life.

Furthermore, Mehdi Boussebaa and colleagues from the University of Bath studied ‘corporate Englishization’ through a postcolonial perspective and found that the process  highlights the demands of “Anglo-American capital”, meaning access to cheaper labor than that of the West. In lieu of this goal, BPO companies dedicate funding, time, and resources to overcome ‘language barriers’ in an effort to utilize a cheaper Filipino workforce, reinforcing the ‘colonial-style’ power imbalance between the West and its past colonies and furthering the divide between those born into fluency and those that are not. 

This biased culture is reflected in the everyday lives of Filipino BPO employees, illustrating how enforcement of Western standards seeps into their impressions of their peers and themselves. Zagabe points out that if employees perform ‘badly’ in terms of English fluency, they may experience detrimental emotional and psychological processes, and may even lose their jobs. On the contrary, if they perform well, they may think they are ‘superior’ over non-fluent coworkers. BPO employees are also extensively reprimanded and berated by overseas customers and notice mother-tongue interference while they communicate in English, subjecting them to racist remarks, slurs, and affecting their ‘customer satisfaction’ ratings. This emphasizes a ‘culture of elitism’ within the workplace and even across borders that rewards those fluent in English in such a way that fits the standard, and punishes those who fail to qualify.

‘Cheap Labor’ & Exploitation

Another celebrated benefit of the Filipino BPO industry is its highly skilled and ‘trainable’ workforce whose labor wages are less than half of what Western BPO employees would earn. According to the popular job recruitment platform, Indeed, the latest average base salary of call center representatives in the United States is around $2000 monthly, while that of the Filipino representatives is around $400 (approx. P19,000) per month. This translates to at least a $1,600 gap between salaries for the same kind of work, indicating overseas companies’ tactics to capitalize on the economic inequalities experienced by developing countries.

One may argue that a $400 monthly salary is enough for an average Filipino to get by; the difference is negligible if it translates to the same level and quality of lifestyle. This is blatantly untrue. The monthly cost of living in Quezon City, the most populated city in the country, is $798 (P38,322) for an average Filipino. In provinces such as Bulacan, the cost slightly decreases to $560 (P26,893). This means that a $400 salary is either less than or barely within the range that would support a comfortable lifestyle for a single Filipino citizen within the country. On a larger scale, such discrepancies in understanding the reality of Flipinos’ experiences underlines overseas companies’ interests in merely maximizing their profit with no regards to supporting offshore employees.

Needless to say, the exploitation of workers from low-income countries by the West is not a new concept. Starting from the 1960s, Filipinos have made up 4% (150,000) of the entire nursing workforce, even though they only make up 1% of the US population. This can be traced back to the 1898 ‘benevolent assimilation’ policy proclaimed by then-US President William McKinley, which called for the “future control, disposition, and government of the Philippine islands to be ceded to the United States”. The policy made it possible for the US to take over the Philippines’ institutions and education with the goal of developing a medical labor force meant to fill the shortage of healthcare workers overseas. To this end, many Filipino nurses were forced to learn Western medical practices and the English language, and were eventually lured into migration with false promises of economic stability and better working conditions. However, once migrated, most Filipino nurses faced grave exploitative labor practices, poor wages, and were treated as second-class citizens

“…Western capitalists instead invest in creating systems that standardize those workers–be it through their education, employment training, or learned professional practices–to better fit the mold of a Western employee…”

The exploitation of Filipino nurses shows a pattern similar to the establishment of the BPO industry within the Philippines. When the West has a demand for a certain kind of service, but wants to save up on costs, cut down on wages, and sacrifice quality working conditions, they employ workers that have no access to better opportunities in their own countries. Thus, Western capitalists instead invest in creating systems that standardize those workers–be it through their education, employment training, or learned professional practices–to better fit the mold of a Western employee, with one sole exception: a lower price to pay for their services. Jan Padios, author of ‘A Nation On The Line’, highlights  the damaging impact of the BPO industry in continuing this pattern: “The Philippines, in the 20th century, was seen as an easily exploitable source of cheap labor and resources for foreign powers. The heralding of the call center industry is too close an echo of that old reputation”.

While the Philippine government may have only supported such immigration programs or economic development plans for the betterment of the country and to finally become globally recognized, they are ultimately counterproductive. It has been more than five decades, and the Philippines is still reliant on export-oriented and import-dependent economic development. The progression of the BPO industry, as with all past outsourced industries, seems to continually place the Philippines in the same status: a continuous supply of offshore or immigrant workers for the West. In order to move forward from this reputation, the nation must  exert its resources and funding to other sectors of the economy that bring jobs to Filipinos and develop the country’s self-sufficiency. The economic development plans must serve primarily the interests of the people rather than foreign capitals.

Foreign Direct Investments, Elitist Gatekeeping & Non-Inclusive Growth

The success of the BPO industry skyrocketed under then-President Benigno Aquino’s regime, as he left a legacy of pushing for neoliberal economic policies and development plans. This included the significant rise and increase of foreign direct investments (FDI) in the country, from $2.0 billion in 2011 to $5.7 billion in 2015. From 2016 to 2017, the main beneficiaries of FDI have been electricity, gas, steam, and AC, manufacturing, real estate activities, and construction, while the information and communications technology industry has been steady in its eighth rank.The BPO industry is unlikely to falter in the following years, having been backed by both the government and investments. After all, the industry was founded on the very principle of attracting foreign investors into the country, believing that it is the best way to supply jobs and employment to Filipinos. The BPO industry has even been dubbed as the ‘largest employer in the Philippines’ in 2019, having created and added 71,000 new full-time jobs to the 1.23 million jobs it has already produced since 2018.

However, the growth of the BPO industry and increased dependence on FDI may be doing more harm than good. In 2012, the Asian Development Bank (ADB) reported that the economic growth brought upon by dependence on the BPO industry and remittances-driven private consumption “has barely trickled down to most of the population”. Despite the millions of jobs created by the BPO industry and its contribution to the increase of employment rates, it still makes up only  1% of the labor force. This may be due to the fact that mostly only college graduates with high English fluency are preferred and employed as call center agents and representatives. Dana Osborne and colleagues from The University of Arizona explain that this system of cherry-picking Filipino workers is essentially a form of gatekeeping by the urban elite, barring the working class from benefiting from the industry’s successes. 

Furthermore, the IBON Foundation observed biased growth in the economy in 2016, since the surge of FDI in the country. They affirm that the claims of the Aquino administration in working toward inclusive growth is a distraction from the reality Filipinos face. The agricultural and manufacturing sector has shrunken. Growth has been limited to industries dominated by capital oligarchs and foreign company investments: real estate, construction, business process outsourcing, and financial intermediation.

Such inequalities reveal how the esteemed economic growth of the Philippines garnered by the BPO industry only widens the burgeoning urban-rural income disparity. This is important to discern because it is easy to mistake upward economic mobility as better quality of living for all citizens of a country, when many other factors come into play in improving the lives of the people. Statistics and numbers should not be the all-encompassing measurement of how well a country is performing; we must also closely look at how these numbers translate into and affect the realities of Filipinos, and adjust our policies and development plans accordingly.

Final Thoughts: Hope for The Future

The BPO industry is a mirage of economic success for the Philippines. While Filipinos experience estrangement from their culture and language, exploitation of their labor, and unequal access to opportunities, the clients they serve continue to prosper and thrive in developed countries, with successful companies that have benefitted from the fruits of their labor. This points to the reliance of the economy on foreign investors that visibly turn a blind eye to other local industries that would otherwise advance the country and its citizens to greater heights if they were only tended to. However, the local industries only continue to be neglected and underfunded simply because they cannot be capitalized in a global market.

The goal for the Philippines should not be to gain recognition by foreign counterparts as a nation of quality labourers and servers. Rather, the hope should be for the country to strengthen its culture and national consciousness, set its own standards, and establish economic sovereignty.

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