Service industry continues as a driving force for growth

Service industry continues as a driving force for growth | Daily Tribune

The Philippines’ service industry continues to be a driving force behind the country’s economic growth, with notable contributions from Business Process Outsourcing (BPO) and the Wholesale and Retail Trade, and Repair of Motor Vehicles and Motorcycles industries. The Philippine economy is poised for a Gross Domestic Product (GDP) growth of 6.5 percent this year after a 5.6-percent growth in 2024, with the service industry growing by 6.7 percent.

The BPO industry remains one of the most significant contributors to the Philippine economy brought about by the skilled labor force and their high level of English proficiency. In 2024, the BPO industry generated an estimated $38 billion in revenue, reflecting a 7-percent growth from the previous year.

Despite the threatened advances in artificial intelligence (AI), this growth is a testament to the Philippines’ position as a global leader in BPO services. The country remains a preferred destination for a wide range of services, including customer support, IT services, and technical support.

The BPO industry also contributes tremendously to employment, providing jobs to approximately 1.3 million Filipinos as of 2024. The demand for outsourcing services, especially in industries such as telecommunications, healthcare, and technology shows no signs of slowing down, ensuring that the BPO industry remains a critical source of economic growth and employment that drives a cycle of economic activity in the country.

The Wholesale and Retail Trade; Repair of Motor Vehicles and Motorcycles industry is another key contributor to the Philippine economy. In 2024, this industry generated significant revenue and provided millions of jobs for Filipinos. This industry accounted for 5.6 percent of GDP growth in 2024.

The repair of motor vehicles and motorcycles sub-sector also remains essential, with a growing number of Filipinos able to purchase cars and motorcycles. In 2024, vehicle sales reached 475,094 units, contributing significantly to the economy and creating jobs in both sales and maintenance. The demand for motorcycle repairs and spare parts has also led to a growth in small businesses and service centers, further boosting local economies.

The growth of the BPO industry, along with the expansion of the Wholesale and Retail Trade; Repair of Motor Vehicles and Motorcycles, underscores the critical role of the service industry in driving the Philippine economy. While AI enhances operational efficiency and the customer experience, it also leads to the creation of new roles in data analysis, AI programming, and other tech-driven functions in the service industry. This will further boost the economy by creating more jobs and increasing productivity and innovation.

In the number of company registrations with the Securities and Exchange Commission (SEC), the services industry accounted for 86 percent, or 44,872 of the new registrations in 2024, with the Wholesale and Retail Trade, and Repair of Motor Vehicles and Motorcycles industry accounting for 12,479 new registrants.

With this, the SEC remains committed to fostering a business-friendly environment to pave the way for a stronger, more competitive, and investment-ready economy that benefits all Filipinos.