Many American companies have outsourced their customer service to the Philippines. Labor in the philippines is cheap, so even with some extra infrastructure costs this saves a lot of money. You can pay a Filipino to answer customer service calls for around $500 per month. An American would cost you $3000. Most Filipinos speak English with an accent that Americans don't have trouble understanding. Other countries that American companies have outsourced to, the accent is often a problem. Like I've called customer service that got routed to India and while the person spoke English, I had real trouble understanding them.
They'll have a US phone numbre, but it gets re-routed to the Philippines with no clue to the caller.
Shortly before I moved to the Philippines, I called my credit card company to make sure I would be able to use the card here. Turned out the customer service person was in the Philippines, and she told me what a wonderful country it was and how I would love it here. We ended up having a nice little chat about the country.
Another time I called a credit card company to report a fraudulent charge. They blocked further charges from that company. (I wasn't really worried about getting a refund, the charge was small.) The customer service person said that to be safe they could give me a new account number, cancel the old number, and send me a new card. I said I'd prefer to not do that because I was in the Philippines and getting a new card to me would take a long time. At that point the customer service person said, "You're in the Philippines? I wondered about that -- I saw charges on your account to SM and Gaisano." (Those are two big department store chains in the Philippines.)
I contacted a web hosting company over their live chat. She helped me with my problem, and then she asked, "Are you a Filipino?" She didn't say how she knew I was in the Philippines, but I'm guessing something told her that the IP I was messaging from was in the Philippines. I said that I was an American living in the Philippines. She said she was in Manila. I told her I was in Cebu though she probably already knew that.
Once I asked if, as we were both in the Philippines, there was a local number I could call instead of paying international rates to call the US and then have it routed back here anyway. They ssid no. I looked it up on the Internet but the only local number I could find was to apply for a job. So I pay international rates to call from the Philippines to the Philippines. Even when I call from my American phone with an American phone number, it goes by where I'm actually calling from, not the nationality of the phone number. Though if I make a call through the wifi, it's free. Only catch is that they apparently have a limited capacity and often I can't get through over the wifi.
Outsourcing in 2024 brought in $38 billion and is growing at 7% per year. GDP that year was $462 billion, so outsourcing is about 8% of the total economy. (As I write this, 2024 is the most recent statistics I could find.) If outsourcing ended tomorrow, it wouldn't destroy the Philippines, but it would certainly hurt badly.
But in the long run, I think this is a temporary industry. It's only viable because Filipinos can be paid much lower salaries than Americans. As the Philippine economy grows and salaries go up, Filipino companies will lose their advantage in this industry. It won't happen this year or next, but eventually.
It's something of a paradox: It's bad for the country to lose this income. But it will lose this income if the country is doing well.
© 2026 by Jay Johansen
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