Chapter 19

The Service
Sector
 Meaning, Components, And Importance
 Service Sector is the dimension of the economy that produces services
rather than goods.

 Services are Nonmaterial Commodities such as Health, Insurance,

Education and Security.

 The Strongest and the most significant production sector of the

Philippine economy.

 Provides the most employment opportunities to the Filipino people.

 Has the most number of registered business establishments, providing

livelihood and investment opportunities to millions of Filipino.
 Trade And Commerce
 Trade and Commerce is the selling of Goods.

 Trade has Two Major modes

o Wholesale
The National Statistical Coordination Board (NSCB) define this
as the resale (sale without Transformation) of new and used goods to
retailers.
o Retail
The National Statistical Coordination Board (NSCB) define this
as the resale (sale without Transformation) of new and used goods for
personal or Household Consumption

 The preferred investments markets in the country

 Transportation, Communication and
Storage
 Transportation and Communication facilitate the flow of
trades and Commerce.

 Storage provides custodial services to traders.

 Storage firms operate warehouses and other facilities

that keep merchandise goods in safe and good condition.
 Finance
 Intermediation is the main function of the financial
sector.

 Banks and other Financial institutions are the main

source of investment funds

 Finance provided jobs to 368,000 thousands of the

country’s labor force.
 Ownership Of Dwellings And
Real Estate
 Lands, Commercial Buildings. Residential houses, and apartments for rent
belong to the real estate industry.

Other Services
 Cover a Wide array of industries, They include medical and health, Social
work and Etc.

Government Sectors
 belong to the service sector and its main responsibility is to deliver
social, economic and general public services to the people
Prospects Of The Service Sector
 The Sector is growing due to the influx of promising profitable
industries.

 One investment area with lots of potentials for growth is the

information and communication technology (ICT) like BPO
industry.

 Another lucrative of ICT-related investments is the replacement of

Mobile Phones.

 Tourism industry is also growing and profitable Market.

 Retail Trade industry has been expanding as more and more firms
engage in franchising.
 ICT-BPO Industry
 Sunrise Industry in the Philippines

 One of the fastest emerging global players in electronic services

market.

 The Phil. Gov. and Business Processing Association of the

Philippines have joined hands to fast-track the growth of ICT
industry.
ICT-BPO subsectors are the following:
 Contact/Call centers

 Knowledge process outsourcing and back offices

 Software Development

 Animation

 Game Development

 Medical Transcription

 Legal Transcription

 Engineering Design
 Contact centers/Call centers are the fastest growing subsector.

 The software development industry is a high value sector because

of its highly qualified workforce.

 Medical transcription is another in-demand service and its function

is to convert medical records into electronic data.

 Legal transcriptions and engineering design are still relatively small

markets in the Philippines.

 There are three factors that attract investors in the ICT-BPO

◦ First, The large pool of ICT-literate and English-speaking workers.
◦ Second, The average hourly wage is relatively low.
◦ Third, Filipino animators are inherently creative.