U.S. bill threatens Philippine call center industry’s $40Bn future

MANILA, PHILIPPINES — A proposed United States Senate bill aiming to repatriate call center jobs could disrupt the Philippines’ $40 billion information technology-business process management (IT-BPM) sector.

According to a report by Manila Bulletin, the bipartisan Keep Call Centers in America Act of 2025 threatens to strip federal benefits from companies offshoring jobs, potentially reversing $7.8 billion in U.S. investments in Philippine operations since 2003.

Threats to Philippine call center industry

With North America accounting for 70% of the sector’s investments, the bill could jeopardize the Philippines’ projected $40 billion revenue and 1.9 million-strong workforce in 2025.

Industry group Information Technology and Business Process Association of the Philippines (IBPAP) has downplayed immediate risks, citing the logistical challenges of relocating operations back to the U.S.

“At this stage, we are continuing to track developments,” IBPAP told Manila Bulletin.

However, the proposal aligns with U.S. President Donald Trump’s protectionist agenda, including recent tariff hikes on Philippine goods.

Economists warn of impacts, as services exports—previously resilient—contracted 4.2% year-on-year in quarter two of 2025, the first decline since 2012 outside the pandemic.

“The Philippines is supposed to be a top service exporter, but we saw the first contraction since the pandemic in the second quarter of 2025. Except for the Covid-19 pandemic, this hasn’t happened since 2012,” said Emilio Neri Jr., Bank of the Philippine Islands (BPI) lead economist.

Global outsourcing at a crossroads

The U.S. bill highlights a bigger confrontation between cost-based offshoring and the political need to preserve jobs onshore. Senator Gallego cited AI and consumer data security as motivations, projecting 150,000 U.S. call center job losses by 2033 if offshoring continues.

“The Keep Call Centers in America Act would work to reverse this trend by limiting federal benefits to companies that ship call center jobs overseas,” Senator Gallego said.

Yet, the Philippines’ competitive edge—English fluency and skilled graduates—has made it a top destination, with U.S. firms investing billions for over two decades.

While IBPAP remains confident in hitting growth targets, the sector’s slowdown signals vulnerability. Neri Jr. noted weakening IT-BPM performance alongside travel declines, blaming domestic bottlenecks.

“Tariffs are hitting us on the merchandise side; our non-merchandise exports appear to be dragged by domestic factors,” Neri Jr. said.

An earlier report also projected the bill’s potential impact on Belize’s $150-million BPO sector.

Although the bill’s fate remains uncertain, its bipartisan support reflects growing U.S. skepticism of globalization—a trend that could reshape the global outsourcing industry.

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