According to BruntWork CEO Winston Ong, Asia has always been the destination for outsourced jobs due to low cost, skilled workers and their good grasp of the English language.
Among all the countries, two nations stand out at the top and have been going at the outsourcing game toe to toe—India and the Philippines. These two countries are often the top picks of global outsourcing staffing firms.
India and the Philippines share many similarities, which is precisely why they are popular with companies from the US, Canada, the UK and Australia. Many business owners wonder which jurisdiction is better for hiring capable outsourced talent, and the jury may still be out.
English Proficiency
India and the Philippines are known to have high education levels but share varying degrees of proficiency.
“In Asia, the Philippines is considered one of the most prolific countries in terms of English speaking skills with a proficiency rate of 92.5%,” reveals Ong.
Though globally, the Philippines ranks 14th overall, businesses say the country’s ability to maintain a neutral accent is one of the primary considerations when picking customer service support.
On the other hand, India is ranked 28th in the world regarding English literacy, giving the Philippines the upper hand.
Labor Costs
India has a working advantage in the workforce, especially for companies looking for the absolute cheapest labor cost.
“India is known for offering relatively low labor costs compared to almost any other country in the world, although its weaknesses are its weak relative position in education, its bad reading on innovation and technology, and its inconsistent rule of law,” says Ong, citing similar analysis conducted by Ray Dalio in his book “The Changing World Order.”
While outsourced customer support is slightly more expensive in the Philippines versus India, the lack of education in India is concerning on a global scale, with Indian students having on average 5.8 years of education versus 11.5 in the average major countries. PISA scores, which measure the proficiency of a 15-year-old student across countries, are not encouraging – 336 versus 483 in an average major country.
BruntWork’s Take
For most employers, it appears the Philippines and India are pretty matched in the global outsourcing scene.
“Ultimately, which country wins the battle for outsourcing supremacy depends on a business’s priority, but average education levels must form part of the decision making process for businesses looking to outsource for the first time,” says Ong.
Though India’s salary costs are lower, hiring there comes with risks that many businesses deem unacceptable including lower English fluency rate, which is a make-or-break factor for many business owners.
“The Philippines has slightly higher labor rates but makes up for it with problem-free English communication skills, work ethic, and higher education levels which is why 98% of BruntWork’s outsourced workers come from the country,” reveals Ong.
