Executive Search in Philippines – 2021 Outlook
Decline Short-lived, but Worst in 35 years
Philippine economic performance in 2020 is worse than expected with GDP growth to decline by around 8% to 9%, its biggest decline in the past 35 years. GDP growth for 2021 is expected to recover to around 7% with government spending on infrastructure to be the main driver.
Consumer spending will remain weak due to unemployment and drop in incomes caused by the COVID pandemic. Vaccination is expected to start in the second half of 2021 which could help start a sustained gradual recovery of consumer spending.
Outlook on inflation is benign with the Bangko Sentral ng Pilipinas expected to keep interest rates low to spur economic recovery. If weak demand for imports remains, it could lead to further strengthening of the Philippine Peso to around P47.50 to a US dollar. Conglomerates and the real estate property sectors will lead stock market recovery.
Towards the latter part of 2021, noise from jockeying for the 2022 Elections will increase, causing some political jitters. The endorsement of a very popular President Duterte will increase the election chances of candidates for all political posts.
On the executive search and recruitment side, most companies in the Philippines, whether local or multinational, still maintain the status quo as most companies in 2020 either froze hiring, restructured and reduced headcount or, in a worst case, closed shop.
However, even amidst the General Community Quarantine, the surge in consumer spending for essential goods and medicines, medical equipment & food and beverage have triggered hiring for critical roles in specific industries such as Fast Moving Consumer Goods, Pharmaceutical & Medical Devices and Equipment, Banking & Finance, Logistics & Supply Chain, Manufacturing and E-Commerce, Media, Information Technology and Digital industries.
Though other industries deemed non-essential such as the entertainment, aviation, leisure, tourism, hospitality, food service and even real estate sectors have been vastly affected, there is some hope that by the latter part of 2021 there will be more renewed interest in people going out again. This along with re-opening the country to foreign tourists may result in the aviation, hotel & food service & leisure industries priming the economy and leading to new jobs and hiring.
The area most likely to see an uptick in job-generation would be in the areas of consulting, shorter-term and contracted employment, staff augmentation and virtual work engagements as most companies still espouse work-from-home for their staff. Telecommuting and web-based meetings are still the norm as more companies choose to do transactions online.
Another consequence of the pandemic on organizational movements is having more senior staff being offered early retirement or voluntarily resigning. There have been some job openings created as internal positions are expected to still be filled even as staff are asked to work shorter hours and fewer days to cut costs.
The upside is the BPO and Call Center industry will continue to benefit as companies offshore still look at the benefits of outsourcing to the Philippines due to lower labor costs and workers’ English fluency skills
With the slow reopening of the economy and the recent holiday season coupled with the hope the new year brings and the anticipation of the vaccine this year, people will hopefully renew their confidence and come out of the longest known lockdown and the Philippines may see some economic gains in the latter part of 2021.
For information on Cornerstone’s executive search services in the Philippines, visit Cornerstone Manila