Is It Risky to Hire Developers in Philippines?
The Philippines is one the leading outsourcing destination in Asia. The country attracts investors, enterprises, and foreign capital with low-cost IT services. A lot of American businesses hire Filipino developers for their development projects. But like any destination, it has its pros, cons, and specifics. Companies looking to expand their payment processing capabilities may consider hiring a Cayan developer in the Philippines, where there is a thriving community of skilled software developers with experience in various programming languages and platforms.
Filipino Programmers: IT Services Market Overview
While the Philippines is well known for its exotic locations enjoyed by tourists from all over the world, it also boasts a significant IT market. In fact, it is one of the leading outsourcing destinations in Asia and the world. According to the World Bank, the IT market’s export in the country equates to US$ 38.19 Billion, which is achieved by the 11 000 IT companies that call the Philippines home.
The English Proficiency Index score of 578 in the Philippines, indicating “High Proficiency,” underscores the nation’s remarkable competency in the English language, contributing to its strong global communication and business capabilities.
Overall, the main components of the ITES sector of the country are:
- Software development and release
- Call centers
- Manufacture and sales of hardware components
The BPO is one of the main reasons a Manila dedicated team is in such demand. Good knowledge of English and westernized culture makes Philippines outsourcing software development market a great destination for many businesses.
The main trends of the Filipino IT market are:
- More focus on the gaming and entertainment industry
- Incorporation of cloud solutions
- Social media integration
- Rise of local start-ups and companies
- A closer focus on cyber-security solutions
Philippines’ Employment Conditions
The Philippines’ employment conditions represent a dynamic landscape. It includes quite a diverse range of industries, including business process outsourcing (BPO), agriculture, manufacturing and tourism.
In the Philippines, payroll cycles are typically structured on a semi-monthly or bi-monthly basis, with salaries commonly disbursed in the middle and at the end of the month. Employers must follow with many different payroll taxes. This includes contributions towards social security, health insurance and other excellent statutory benefits, impacting the overall cost of labor and the financial operations of businesses.
The minimum wage in the country varies across different regions and sectors, with the most recent data indicating a monthly minimum salary ranging from approximately $159 to $399, depending on the location and industry. Overtime pay is overseen by labor laws. This ensures that employees are fairly paid for any additional hours worked, often at a higher rate than their standard rate.
Employee benefits in the Philippines include health insurance, paid leave and retirement plans, which are offered by many companies. And, this is to attract and retain skilled workers! These benefits contribute to enhancing the overall welfare of employees, promoting job satisfaction and creating a positive work culture within organizations.
IT Market in Different Cities Across the Philippines
The Philippines has several big metropolitan areas with each of them claiming its slice of the local IT market. Based on the information provided by PSIA (Philippine Software Industry Association), it has been reported that approximately 190,000 developers are currently residing in the country. Let’s explore the main cities for outsourced software developers Philippines and how much influence they have on the market:
The city is known for its coconut industry and various other manufacturing enterprises. But it also has a lively and growing IT industry with companies such as the award-winning ThinkBIT Solutions Phils. Inc calling it home since 2014. The city also hosts the first and largest IT park in the country known as Eastwood City Cyberpark in Bagumbayan. According to quezoncity.gov.ph, the total of Android developer Quezon city and other professionals employed in the I T sector equates to 25,006 people. The average salary for a PhP developer Quezon city is around $751.29 per month.
There are several large software development companies in Manila such as IBM (Philippines), Hewlett Packard (Philippines) and Microsoft (Philippines), making it the largest employer of IT professionals in the country. The web developer salary Manila is around $706.00 per month. Outsourcing activities from other countries to professionals or software companies in Manila has been thriving over the last few years, as they have some of the best software developers in the Philippines.
Davao City is the biggest city by land area in the Philippines and even ranks as one of the biggest cities in the world. Davao is a world-class city that offers big tech companies such as APEX IT Innovators a place to grow their footprint in the I T industry, while their employees can enjoy a good and safe quality of living. A web developer Davao earns around $362.00 per month, which compared to the cost of living, is an excellent salary to earn in this city.
Although Caloocan is more known for its processed foods and textiles industry, the IT sector in the Philippines’ third biggest city is alive and well. The business-friendly city features some of the country’s biggest players in the IT sector with names such as Pinnacle Technologies doing business in the city. The average salary for a developer in Caloocan working for top software development companies in the Philippines is $618.89 per month.
Cebu is one of the biggest tourist attraction locations in the Philippines, where visitors from all over the globe can enjoy snorkeling, island hopping and luxurious hotels at relatively low prices. The city is a hub for the IT sector, as the local government has many initiatives supporting start-ups and new businesses to open their doors here. In fact, some of the biggest software development companies Philippines are based here. It is, therefore, a popular destination for website developer Cebu candidates looking to build a career in the IT sector and a web developer Cebu can earn around $635.00 per month.
Check Profiles of Available Developers in the Philippines
We have several consultants in the Philippines available for hire right now – check their profiles below and inquire for more!
3 years of experience
Marco is a dynamic backend developer with a focus on Java-based applications. Working primarily with Spring Boot and Hibernate, he has been instrumental in creating efficient, scalable backends for diverse industries. Marco’s dedication to code quality and optimization, coupled with his mastery of relational databases, positions him as a cornerstone in any development team.
- Spring Boot
4.5 years of experience
Liza shines as a frontend developer, specializing in Vue.js. Her expertise spans building user-centric web applications that balance aesthetics with functionality. With a keen eye for design and a deep understanding of Vue’s reactive architecture, Liza consistently delivers frontends that captivate users and amplify usability.
4 years of experience
Reynaldo is a versatile full-stack developer with a penchant for PHP, particularly the Laravel framework. He seamlessly bridges the gap between frontend and backend, ensuring cohesive and robust web applications. Reynaldo’s strength in database design and his prowess in crafting responsive interfaces using Bootstrap makes him an integral asset to development initiatives.
3.5 years of experience
Jasmine is passionate about mobile app development, with a focus on the Xamarin framework. This allows her to craft cross-platform applications that deliver native performance and feel. By leveraging C# and the .NET ecosystem, Jasmine has been part of numerous projects that serve diverse user bases, ensuring that applications are not only functional but also optimized for user engagement.
An Overview of the Salaries of Software Engineers in the Philippines
As with any other job market, there is a difference in salary expectations with the level of experience or education when it comes to outsource software development Philippines activities. Below is a comparison in monthly salaries (USD) between the three levels of experience in the Software Engineer sphere. This is useful for anyone considering to hire developer Philippines candidates.
An Overview of the Legal and Regulatory Aspects of Outsourcing
As with local hiring, there are also some legal aspects to consider when outsourcing to software companies in Philippines. Two of the main aspects to think about when outsourcing globally are:
- Labor Laws
Navigating labor laws across different countries can be a daunting task, laden with challenges. The consequences of non-compliance can be costly to your business. That’s why it is crucial to partner with a trusted software development company Philippines that specializes in managing labor laws, allowing you to focus on assembling your team.
Here are some key statistics to consider when entrusting software engineer companies in Philippines to handle labor laws and local matters:
- Compliance Expertise: An experienced agency should possess knowledge of the labor laws specific to the country you are operating in and the country you are planning to outsource from.
- Risk Mitigation: By partnering with an agency, you can mitigate risks associated with labor law violations. They stay up to date with regulatory changes, advising on necessary adjustments.
- Administrative Support: Entrusting an agency with labor law and local issue management means offloading the burdens related to HR processes, payroll, benefits, taxes, and other admin.
- International Network: A reputable agency should have a robust network and established relationships in the countries of operation.
- IP Protection
Investing in outsourcing your IT project and entrusting your ideas to a third party can be a dreadful experience if they exploit your concepts for their own gain. Therefore, just like when hiring employees, it is vital to partner with a trustworthy outsourcing partner who can ensure the enforceability of non-disclosure agreements (NDAs) and other legal documents. To safeguard your interests, it is crucial to conduct thorough research and select agencies with a proven track record of successfully collaborating with companies on similar projects.
Pros and Cons of a Dedicated Development Team in Philippines
Today, there are many benefits of outsourcing talent to other countries, such as the Philippines. Great internet access and easy communication has made it easy for businesses to hire remote workers from all over the world. However, this has also posed some challenges over the years. Let’s delve into the pros and cons of investing in Philippines software development outsourcing:
- Labor Cost. Labor costs for a website developer Manila or the rest of the Philippines is much lower compared to many other countries. This is because the cost of living is lower. As a result, the country is an excellent outsourcing destination for businesses around the world. Many companies in the US, Canada and Europe outsource their developing needs to countries such as the Philippines to save valuable capital.
- Similar Culture. The culture in the bigger cities in the Philippines is similar to Western culture. This makes the process of working with a software development services Philippines team easier. Culture plays a big role in the work environment, and its impact should not be underestimated.
- Language. Clear communication is one of the first rules of making a success out of a project. In the Philippines, most I T and Victoria de Manila developer talent is fluent in English, making it easy for businesses in Europe, Canada and the United States to work with Filipino developers.
- It is comfortably located for clients from Japan, Australia, and New Zealand. They share little time differences, which makes collaboration much more efficient.
As with any hiring model, there are some challenges to outsourcing software development Manila and the rest of the Philippines. Below we look at some of the cons of working with a developer team from this country:
- The time zone is not very comfortable for the US or European clients. It is harder to communicate directly with Philippines dedicated developers from there. And it also adds up to issues with project management and control.
- Work Quality. The quality of the work can sometimes be lower than expected due to a lack of experience or education. To make sure you are dealing with professional web developer Manila candidates, it is important to ask for proof of historical work and reviews or feedback from past clients.
- Internet Speed. While a big portion of the country is well developed, it, unfortunately, does rank as one of the countries with the slowest internet speeds globally. This can be a difficult obstacle to overcome, as most communication and work will be done remotely via the Internet. Consequently, it is best to ask for proof of a good internet connection before outsourcing software development services Manila and the rest of the Philippines.
Despite the risks, many companies find & hire programmers in the Philippines. After all, the choice is up to you and your goals and budget. When hiring software developers in the Philippines, companies can benefit from the expertise of a Xamarin mobile developer or a Microsoft cloud architect, while also effectively working with offshore teams to maximize productivity and cost efficiency.
Overall, there are obvious benefits why outsource software development Philippines worth consideration. But it is important to know that there are alternatives to Philippines software development.
Do Not Want to Hire Software Developers in Philippines? Alternative Destinations
Software developer Philippines is not the only option out there. Of course, Asia has been one of the first outsourcing hubs. Companies also hire developers in Vietnam, China, or India. While hiring software developers in the Philippines offers many advantages, some companies may also choose to supplement their team with a software developer Germany to provide an additional level of expertise and diversity to their development efforts. But nowadays Eastern Europe (and especially Ukraine) is gaining momentum with their IT outsourcing services. If you do not want to hire developers in Vietnam or the Philippines because of the inconvenience or risks, look closer at what Eastern Europe has to offer:
- The convenient location makes it the perfect choice for the EU and UK clients. It is easy to travel to and there are always direct flights.
- The time zone is much more comfortable for Europe and the USA. There is a difference with the US clients, but depending on the state, it is still possible to have a comfortable online meeting for both parties. And for Europe, there is little to no time difference, which makes project management extremely effective in comparison to a dedicated development team in Philippines.
- There are no big natural disasters that can cause power loss and serious delays in work. Such risk here is almost at zero, not like when you hire software developers in Philippines.
- Eastern Europe and Ukraine have a great reputation for the quality of work. Ukrainian programmers scored 88.7 out of 100 in HackerRank competitions and took 11th place worldwide. And Filipino programmers took 46th place.
- Ukraine is compliant with GDPR, which is important for not only the EU clients but all businesses that work on the EU territory.
- As a part of Europe, Ukraine shares the same business values and is generally very comfortable to work with.
Java developers for hire in the Philippines is not the only option when it comes to budget-friendly outsourcing. Eastern Europe in general and Ukraine, in particular, provide high-quality IT services at reasonable prices.Before you choose to hire software developers in Philippines, consider all the benefits Ukraine outsourcing has to offer.
Ukraine as IT Outsourcing Destination
Ukrainian programmers have somewhat higher rates than PHP developers in Philippines for hire, but they are still extremely budget-friendly for the EU and US clients. Except for the low costs, there are other significant benefits of this outsourcing destination:
- Local professionals are highly-valued all over the world. They are known for high-quality services, that’s why there are more than 100 R&D centers of industry giants here.
- It is convenient both in terms of time zone and location. There are many direct flights to the major tech hubs.
- Although the general population is not as good at English, as in the Philippines, the IT specialists have a pretty good command of it. It is impossible to work as a software developer without great English skills, that’s why 80% of programmers know it pretty well, which makes communication easy and comfortable.
- The country has a great talent pool with more than 200,000 specialists, the majority of which are working on outsourcing projects. Local universities provide excellent education and prepare new professionals each year.
- Time zone: GMT+2
- Average Monthly Rate: $2000 (source – Mobilunity’s Recruitment Team research on the local job markets)
- Biggest Tech Hubs: Kyiv, Lviv, Kharkiv, Odessa, Dnipro
- Size of Talent Pool: 200,000 professionals
The Philippines vs Ukraine: Comparison Table
To summarize the pros and cons of both destinations, have a look at this comparison table to make an educated choice.
|Size of a tech talent pool||190,000||200,000|
|Education level||Higher education, BA or MA||Higher education, BA or MA|
|Talent availability||Lower due to high demand||High, 70% of IT providers work for outsourcing|
|Risks related to natural disasters||High||Low|
|Data safety and insurance||No compliance with GDPR||GDPR compliant|
|Quality to price correspondence||Average, risk of poor performance||High, great performance for the price|
|Ease of doing business||Easy and convenient for Japan, Australia, or New Zealand||Easy and convenient for the USA, the UK, and the EU|
The choice depends on the scope of the project, the residence of the client, and the budget. Although outsourcing software development Philippines market has many advantages, Ukrainian developers offer higher performance when it comes to quality. Ukraine is also much more comfortable for the EU and US partners in terms of location and time.
The Benefits of Outsourcing the Hiring Process to Professionals
Trusting a professional software outsourcing Philippines agency or Business Process Outsourcing (BPO) company to handle your hiring process when outsourcing abroad can bring numerous benefits. Here are some key advantages:
- Local compliance: By delegating the task to trusted software development companies in the Philippines, you can avoid the complexities of navigating labor laws and regulations in a foreign country.
- Access to a larger talent pool: Professional agencies often have extensive networks and resources to tap into a broader range of professionals.
- Scalability: A reputable software developer company in Davao can adjust your staffing requirements based on your business needs. Whether you need to scale up or down, they have the flexibility to adapt.
- Cost savings: Outsourcing the hiring process eliminates the need to establish an in-house HR department, saving you the costs associated with managing HR personnel.
- High-quality staff: Since the agency or BPO’s reputation is tied to the quality of their services, they are motivated to provide you with skilled and competent staff, such as PhP developer Cebu candidates or web developers in Manila.
Mobilunity: Your Reliable Outsourcing Partner for Software Developers
Mobilunity, with over ten years of experience, specializes in outsourcing professional and experienced IT staff to companies worldwide. Our goal is to assist you in efficiently assembling a developer team for your IT project, big or small, ensuring its success.
Our dedicated recruitment team maintains high standards in selecting your team. Our candidates are carefully vetted and prepared to deliver results from day one. These points, combined with our remarkable ability to scale up and down in this fast-paced industry sets us apart.
Choose from our available teams in Ukraine and the Philippines, tailored to your needs. We offer ready-to-go teams at an affordable rate, free from hidden fees. Our unbeatable fixed monthly fees enable better planning, safeguarding against unexpected financial risks.
Mobilunity’s Main Service Models
At Mobilunity we have several hiring solutions for our clients interested in outsource programming Philippines solutions. We understand that each business has unique needs and we try our utmost best to offer a solution for your business. Our solutions include:
- Dedicated development team
This is our main service model which allows you to take full control of managing a dedicated team of developers, while we take care of all the HR, accounting and helpdesk requirements This model is ideal for businesses requiring full-time workers for larger or ongoing tasks and projects. This model is offered at a set monthly fee that suits your budget.
- Consultancy service
This solution is ideal for smaller projects or businesses that require a part-time team. The team will still be dedicated to your project for the agreed hours and you will be billed accordingly. You will also be in charge of direct management of the part-time team, while all HR, accounting and helpdesk tasks are covered by Mobilunity.
- Recruitment service
We do offer a simplified recruitment-as-a-service solution as well. This process entails us searching for the ideal candidate for your company’s vacancy. We have a team of recruiters, who specialize in this sector and will find you the perfect candidate. We can recruit talent in the Philippines or find the best candidates in Eastern Europe. For example, in 2020, we assisted a client in Japan with great success by employing the professional they were searching for to fill the role they had. Read more about this successful partnership with an award-winning Japanese online music service here.
Mobilunity shares western business values and always puts focus on the client’s needs. If you want to hire a dedicated team of programmers, we are here to help you.
- Are developers from the Philippines a safe bet?
It is typically deemed safe to hire developers in the Philippines. There is a big number of highly qualified programmers who are also fluent in English in the country. Developers in the Philippines are well-known for their expertise and commitment to their job, and many have worked with clients from other countries.
- What are the benefits of finding software engineers in the Philippines?
There are many benefits to sourcing your development team from the Philippines. Among these include a culture that promotes teamwork and collaboration, reduced labor costs compared to Western countries, and a robust education system that generates highly qualified individuals.
- Does communicating with Filipino programmers provide any linguistic challenges?
Working with Filipino developers rarely presents linguistic challenges. As English is both an official and widely spoken language in the Philippines, it facilitates easy and quick communication with locals. Developers from the Philippines tend to be highly proficient in both written and spoken English.
- What criteria should I use when choosing Philippine-based developers?
Developers in the Philippines should be judged on their technical knowledge, years of experience, portfolio of work, ability to communicate effectively, and cultural compatibility. Their technical abilities and problem-solving capacities can be evaluated through interviews and tests.
- When looking to hire developers, should I be wary of any potential pitfalls when working with Filipinos?
Hiring developers in the Philippines is risk-free most of the time, but the time difference might be an issue for organizations situated in the West. For this to go off without a hitch, good planning and coordination are needed. To further reduce the chances of negative outcomes, it is essential to lay out specific goals and make appropriate legal and contractual structures.