Oh, we’ve had quite a lot of news about how the US recession (if not depression) and the worldwide economic crunch will hit us all hard by next year. That makes many a Filipino wonder what kinds of preparations we need to stave off whatever effects that might have on us. As a society, we’re pretty resilient to these things. While Americans are doing murder-suicides over the loss of their homes, we can still afford to fill malls with people on weekends even if it’s just for window shopping or leeching free wi-fi. In the US, companies are declaring bankruptcy, laying off workers and shutting down operations. Now I wonder what this economic crunch has got in store for the Philippine job market especially for IT workers.

Many tech workers have elected to go freelance due to its perks. Flexible work hours, being your own boss, and higher rates. It’s pretty much like getting the net gains of going abroad while enjoying the comforts of home. Who can blame them for going freelance?

I’ve been doing some headhunting for a small start-up game development company recently and quite seriously, I am disturbed by how freelancing has affected the general mentality of people on tech-related work. In my opinion, the popularity of outsourcing and web working, has conditioned freelancers to always go for the big bucks. The thing is only a few of them have the right business sense to make their market attractive to everyone, especially local companies who need manpower.

Don’t get me wrong. Earning money is good and freelancing is one of the better ways to maximize your earning potential while getting to manage your own time. Heck, I have been doing online work for nearly two years now. However, what I don’t understand is the seeming arrogance and money-focus attitude it has instilled in most IT professionals.

This, I think, has made quite the dilemma for many an IT start-up company. The presence of multinational IT companies alone had definitely set the competition with regard to the industry rates. The only selling points of smaller organizations would be flexibility in working arrangements and a home-y and more personal environment. As far as compensation packages go, multinational companies do have the paying power. However, to be fair, the rates that they offer for staff-level compensation are still quite reasonable. And they have rate schemes that depend on skill and backgrounds.

Today, based on observation, many tech workers do not want to be tied down to any particular company since the freelance market has been quite lucrative enough. Visit tech community forum jobs threads and you’d see that many are just interested in working freelance or part-time. For local companies and that makes filling in key positions a real headaches. With most of the local talent opting for freelance, and with rates that start-ups simply can’t match, who will be left for these companies to tap? Perhaps outsource work to Bangladesh then.

Whenever I chance upon someone who’s willing to explore full-time options, it is really surprising at how much they are plying their services. Even multinational companies aren’t willing to shell out a six-figure salary for someone who’s just our of college after a year or two! And it’s not like these people graduated from UP or Ateneo (or La Salle). The funny thing is, for many of these people who think this way, salaries are non-negotiable. Sticking to their freelancer pride with “Hey, I can earn twice/thrice that in a month going freelance.” Heck, I know UP honor graduates who are quite content with local industry-standard rates and here comes this guy from some no-name college with barely half the competency (as seen in their resume and portfolios) asking for higher rates. It’s unbelievable. I never want to negotiate with such attitudes, I just send them a short thank you note for sending in their resume and click on archive.

Now this makes me think about next year. Generally, all industries are taking a hit due to the financial crunch and I wonder if the freelance market will still be as lucrative next year. The main reason why many US businesses ship jobs offshore is because of the cheap labor over here. However, it makes you think, with the amount of Americans losing their jobs over there, it’d just be a matter of time when US IT professionals who are out of the job, pressured to pay the bills and make payments, would start working for chump change.

Here’s a funny observation. I tried to tap a PHP programmer to work on a project. Not a lot of experience and with so-so background and the guy’s asking price is $12 an hour. That’s quite hefty since the project requires input that’s equal to a full-time work. 8 hours a day, 5 days a week. That meant, that the guy’s monthly rate is $2112 and that’s f*ckin’ six-digit payout a month! I was checking some old contacts in the US and found one guy (an American), a certified IT professional who just lost his job after one of those massive job cuts over there. Impressive resume and willing to work on the project for $2500 to tide him over. Since the project I’m recruiting for is for a US company, logic tells me to just tap the American and tell the company to just take their recruitment locally.

I mean, heck, if US labor rates are dropping, then it will just be a matter of time when US companies turn inward in their recruitment and make the Filipino freelance market not as lucrative as it was. That should force freelancers to go local as well and adjust their rates to be competitive with the local industry. That would surely help the local industry to thrive with the local talent pool ready to contribute locally as well.

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