Outsourcing Statistics: Eye-Opening Facts & QnA

According to our most recent outsourcing statistics, an increasing number of organizations around the world are looking to outsource some of their important and non-essential business tasks to third-party businesses in order to optimize workflow and cut costs. Outsourcing has become a way of life for many small and major businesses today.

You’ll find everything there is to know about outsourcing in this page, including the numerous terms of outsourcing, the top countries for outsourced employment, the market worth of this burgeoning industry, the influence of the coronavirus, and much more.

But before, have a look at this list of the most fascinating facts about outsourcing:

The following are the top ten outsourcing statistics for 2021.

The United States outsources around 300,000 jobs each year.

The most top motivation for outsourcing (70 percent) is to save money.

From 12.7 percent in 2019 to 13.6 percent in 2020, the total IT budget increased.

There were no covid-related adjustments in outsourcing marketing activities for 58.8% of US marketers.

Larger companies are 66 percent more likely than small businesses to outsource.

In the United States, the “gig economy” employs 36% of the workforce.

In 2019, the global outsourcing market was valued at $92.5 billion.

The global IT outsourcing market is expected to be valued $397.6 billion by 2025.

In 2021, 83 percent of IT leaders plan to outsource their security to a managed service provider (MSP).

24 percent of the business

Small businesses outsource in business to increase their efficiency.

Facts & Figures about Outsourcing

Outsourcing is defined as hiring someone who does not work for your company to provide your company’s services. Outsourcing is often used by companies to cut costs. Outsourcing can be linked to a variety of jobs, from IT to customer service.

In 1989, this business technique was recognized for the first time.

1. RPA (robotic process automation) has been adopted as a digital enabler by 64% of leading companies.

(Deloitte)

With 68 percent of the leading industries using Cloud as one of their digital enablers, the world-renowned Cloud is only 4% ahead.

According to Deloitte outsourcing statistics, there is no concern about performance, unlike in 2018, when 50% of those polled expressed reservations. However, currently, the key worry is staying competitive and deciding whether to use one or multiple digital providers.

2. As a result of the epidemic, 48 percent of businesses throughout the world will increase RPA deployment by 5% or more.

(PRNewswire) (UiPath)

According to outsourcing statistics, the post-pandemic concerns will most likely be addressed through automation. However, 57 percent of companies believe that their employees are concerned about the changes in the workplace. Many of them are concerned that due to automation and the stress generated by the pandemic, they would be unable to succeed in their jobs.

RPA is being used by 75% of companies to support their remote workforce.

3. The United States outsources around 300,000 jobs each year.

(Aptude)

When it comes to outsourcing statistics in the United States, a big number of jobs are shipped offshore, leaving hardworking Americans jobless.

4. By 2025, India’s IT outsourcing industry will have grown at a 7.25 percent compound annual growth rate (CAGR), reaching INR 8,830 billion ($121,335,149.20).

(Accelerator for Outsourcing) (Classic Informatics)

India is the world’s leading provider of IT outsourcing services. Why did you choose India? There are numerous explanations for this. India, for example, has no communication difficulties because it is one of the most English-speaking countries in the world. Furthermore, outsourcing is far less expensive than in other wealthy countries.

Similarly, Indian outsourcing industry statistics indicate that the country would have the biggest number of software developers by 2023/2024. In this regard, India may even surpass the United States.

5. IBM is the world’s largest outsourcing company.

(Source: Insider Monkey)

IBM has a market cap of $105.66 billion and revenue of $76.5 billion. Furthermore, according to outsourcing job statistics, this international technology behemoth situated in New York employs 383,800 workers.

Deloitte, a company with $47.6 billion in revenue, won the silver medal. Accenture, an Irish company, comes in third place with $44.7 billion in revenue.

6. The most top motivation for outsourcing is to save money (70 percent).

(Deloitte)

The second reason is because it is adaptable (40 percent ). For 20% of businesses, getting to market quickly is critical. According to Deloitte’s outsourcing statistics graphs, access to tools and procedures, as well as agility, are important to 15% of those polled.

The number of workers hired by US abroad affiliates in 2018 was 7. 14.4 million.

(The Equilibrium)

The companies in question employed individuals in a variety of fields, including technology and contact centers, as well as human resources and manufacturing.

8. The total value of outsourced IT services will exceed $413.72 billion by the end of 2021.

(By Daxx) (Statista)

From 12.7 percent in 2019 to 13.6 percent in 2020, the total IT budget increased. The fastest-growing segment of the IT outsourcing industry in 2020 will be middle-sized IT companies.

Despite the epidemic, several IT businesses have decided to increase their IT budgets, according to 2020 outsourcing statistics. Others engaged with their IT outsourcing partners, both offshore and nearshore.

Artificial Intelligence has been adopted by 9.58 percent of companies.

(Deloitte)

AI is a new burgeoning trend that has been embraced by numerous companies. According to one survey, intelligent automation adoption will require additional training for 29.4 percent of workers.

Companies that have already implemented RPA are more inclined to accept AI adoption.

There were no covid-related changes in outsourcing marketing activities for 10.58.8% of US marketers.

(Statista)

Only 19.4 percent of marketers in the United States noticed a change in outsourcing marketing efforts during the pandemic, according to 2020 outsourcing statistics.

In the United States, the “gig economy” employs 11.36 percent of the workforce.

(Gallup)

Freelancers and workers who take short-term contracts in exchange for remuneration make up the gig economy, which also includes freelancers in the outsourcing industry.

According to freelance statistics, they are highly happy with their earnings. Similarly, massage treatment was the highest-paying gig economy employment in 2020. Their hourly rate was $27.84 on average.

Market Value and Cybersecurity in Outsourcing Facts and Figures

What is the value of the outsourcing market, and what role does cybersecurity play?

12. In 2019, the global outsourcing market was valued at $92.5 billion.

(Student) (Statista)

The United States had the highest revenue share. According to US outsourcing statistics from 2019, the outsourcing market in the United States was valued $62 billion. Europe, the Middle East, and Africa followed close behind, with Asia-Pacific accounting for the least portion of global income.

In 2019, the global revenue of IT outsourcing was $66.5 billion.

(Statista)

But hold on! There’s more!

According to outsourcing statistics from 2019, BPO (business process outsourcing) produced another $26 billion in global income in the same year.

14. The global IT outsourcing market is expected to be worth $425.19 billion by 2026.

(Student) (GlobeNewswire)

Between 2021 and 2026, it is predicted to grow at a CAGR of 4.5 percent. India will be one of the leading countries in terms of market share.

Its IT-BPM has already aided the country’s socioeconomic development. Furthermore, many Indian political and business leaders believe it is the country’s future. On that point, Bengaluru has been named India’s best city for IT professionals.

Furthermore, by 2025, the Indian IT outsourcing market is anticipated to be valued INR 8,830.14 billion ($120.67 billion).

According to outsourcing statistics, 15.65 percent of CISOs outsourced 21 percent to 30 percent of their cyber operations.

(Deloitte)

The majority of small and mid-sized businesses do not have large cybersecurity expenses. Outsourcing comes in handy in this situation. Around 14% of businesses say they outsource more than 50% of their cybersecurity operations.

In 2021, 16.83 percent of IT leaders plan to outsource their security to a managed service provider (MSP).

(According to Security Magazine)

COVID19 is the primary driver behind this decision. Specifically, 89 percent of the industries polled will need to accelerate their digital transformation by 2020. As a result, current resources were stretched to their limits, exposing the company to more cyber-attacks.

Many companies have faced cyber threats, so it’s only natural that the outsourcing trends that began in 2020 will continue in 2021.

17. Outsourcing security activities is expected to grow the MSP market to $41 billion by 2022.

(Infosec)

The most critical cybersecurity services that should be outsourced are security operations. Because companies require round-the-clock surveillance, the most vital outsourcing service is having a security staff that will safeguard any sensitive information (website, communication channels, database). Developing a security strategy and security architecture is also crucial.

Hiring a consultant rather than an outsourcer is a preferable option if you want more control over the decisions.

Statistics on Small Business Outsourcing

Should small businesses hire outsourcers and how crucial is outsourcing to them?

18. Larger companies are 66 percent more likely than small businesses to outsource (merely 29 percent of them outsource).

(Doctor of Time)

It’s unclear why this is the case. However, it’s possible that smaller companies (those with fewer than 50 people) lack the financial resources to invest in outsourcing services, as opposed to larger companies with more financial resources.

According to the most recent offshoring statistics, almost 37% of small businesses employ outsourcing to manage at least one of their business procedures.

(Clutch)

This might include everything from IT and HR to customer service and data security.

Accounting and IT services, for example, account for 37% of all outsourced activities, while digital marketing accounts for another 34%.

Twenty-four percent of small businesses outsource in business to increase their efficiency.

(Clutch)

Another 18 percent outsource to acquire expert help; 16 percent outsource to be more flexible; and 15 percent outsource to allow their staff more free time, according to outsourcing statistics.

21. The top three benefits of outsourcing for small businesses are increased profit, increased sales, and improved cash flow.

Neil Patel (Neil Patel)

Hiring new personnel (50 percent), boosting profit (46 percent), employee healthcare (44 percent), growing sales (39 percent), and managing cash flow are the top five issues that small businesses confront (34 percent ).

In most cases, outsourcing kills two birds with one stone. How? Outsourcing reduces the need to hire staff and purchase employee health insurance while still offering a significant boost to the previously listed factors.

Statistics on Outsourcing by Industry

Which industry had the most outsourcing success?

22. The accounting industry is the most outsourced.

(Clutch)

Small businesses outsource accounting and finance in 37% of cases. The same percentage of businesses outsource IT, while 34% outsource digital marketing.

In 2021, 23. 24.5 percent of all organizations will increase their outsourcing efforts or outsource for the first time.

(N-ix)

Companies with between 10,000 and 50,001 employees are the most conscious of the importance of outsourcing. 61.1 percent of large companies are prepared to make the investment.

51.6 percent of businesses with 1,000 to 10,000 employees will follow suit.

24. Outsourcing statistics predict that by the end of 2021, outsourcing will account for 70% of the IT industry’s market value.

(Orient)

The IT industry is expected to be worth $413 billion by the end of this year, according to estimates. What’s more, guess what? Outsourcing will account for 70% of the funds mentioned.

Because technology is always changing, companies must ensure that they keep up. Cloud services are used by over 94 percent of IT outsourcing organizations to make necessary upgrades.

HR consultancy is the most prevalent service provided by HR outsourcing organizations.

(ExtensisHR)

According to HR outsourcing statistics, HR consulting is the most common service provided by HR outsourcing organizations (45 percent ).

Benefits administration is the second most popular service (36 percent), followed by time tracking (24 percent) and insurance services (19 percent ). Performance management is only related with 10% of services.

Outsourcing accounts for 70–80 percent of finished manufacturing products.

(Orient)

Many manufacturing companies outsource their labor costs in order to save money. According to statistics on outsourcing cost savings, China is the most favored location for manufacturing outsourcing due to lower labor costs.

In other words, the minimum wage ranges from $162 to $358 a month, allowing companies to save 30% to 80%. However, this is greater than monthly wages in India, which range from $66 to $202.

27. Approximately 40% of help desk roles in the banking industry are outsourced.

(Orient)

The contact between the company and the customer is maintained by help desk personnel. They also assist consumers with technological issues and concerns. Furthermore, 85 percent of clients are willing to pay a higher price for a better help desk experience.

FAQs

What is the prevalence of outsourcing?

(Accelerator for Outsourcing) (Clutch)

Outsourcing is a very widespread practice. Outsourcing is used by more than a third of small businesses to help them become more productive, increase their skills, and allow their staff more free time.

In fact, many companies (large and small) use outsourcing to cut costs and increase flexibility. India leads the world in IT outsourcing, with the Philippines and the United States leading closely behind.

What percentage of American companies outsource?

(Accelerator for Outsourcing)

Sixty-eight percent of American companies outsource to low-cost countries. Accounting, IT support, digital marketing, development, human resources, and customer service are the most outsourced services.

IBM is the largest outsourcing company in the United States, with 383,800 employees, $76.5 billion in revenue, and $153.4 billion in assets. With $47.6 billion in revenue and 330,000 workers, Deloitte is in second place.

What percentage of employment in the United States are outsourced?

(Aptude)

While there is no definite answer, it is extremely difficult to keep track of outsourcing contracts at any given time. What we do know is that around 300,000 jobs are shipped overseas each year.

In other words, a significant number of US employment are being transferred to other countries.

Which countries are the most reliant on outsourcing?

(Accelerator for Outsourcing)

The United States is the world’s leading outsourcing country, accounting for 84.2 percent of all outsourcing deals in 2017. On the list of top outsourcing markets, the United Kingdom and Australia are ranked second and third, respectively.

India, with its IT professionals, is one of the top countries where work is outsourced. After that, there’s the Philippines, which excels at customer service jobs.

Ukraine and Poland are also gaining traction, particularly in the IT industry. China, on the other hand, is the most favored outsourcing destination for manufacturing.

How much has outsourcing grown in recent years?

(Statista)

Quite a bit, actually. It was $88.9 billion in 2015, but dropped to $76.9 billion in 2016. It rose to $88.9 billion in 2017, but fell to $85.6 billion in 2018 before rebounding to $92.5 billion in 2019.

According to market statistics, it has varied quite a bit during the last five years.

Is outsourcing on the rise or on the decline?

(Deloitte)

The outsourcing industry is predicted to increase as a result of the pandemic.

To begin with, people have become more comfortable with virtual meetings, interviews, and hiring when companies began to adopt a remote working model.

Second, due to the economic downturn, companies are leading for ways to save money, which has led them to turn to outsourcing.

Finally, outsourcing remains an important tool for client organizations and plans.

What is the size of the outsourcing industry?

(Accelerator for Outsourcing)

In 2019, the global outsourcing industry was valued at $92.5 billion. According to projections, it is expected to reach $114 billion by 2025.

As a result, the outsourcing industry is quite large. In fact, the outsourcing industry, together with oil and gas, is one of the most important contributors to the global economy.

Conclusion

You should now have a better idea of why companies outsource.

Whether it’s a small business or a giant organization, the aims are the same: decrease costs, focus on key business operations, hire experts, and so on.

Our outsourcing statistics, as well as our general overview of global outsourcing companies, should have piqued your interest and given you a better understanding of how the outsourcing market operates.