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How Outsourcing Jobs Affects the U.S. Economy

What you need to know about outsourcing jobs

outsourcing jobs 2022

How Job Outsourcing Affects the Economy

Technology outsourcing, call center outsourcing, human resources outsourcing, nafta job losses, jobs in mexico, india attracting u.s. companies, jobs in china, underpaid workers, rise in the freelance economy, the bottom line, frequently asked questions (faqs).

GCShutter / Getty Images

Job outsourcing occurs when U.S. companies hire foreign workers instead of Americans. In 2019, U.S. overseas affiliates employed 14.6 million workers. Four industries that are often affected are technology, call centers, human resources, and manufacturing. 

Key Takeaways

  • Job outsourcing can help American companies compete by keeping prices low, but it has a negative effect on U.S. employment.
  • America has lost jobs to China, Mexico, India, and other countries with lower wage standards.
  • Companies outsource domestically as well and have been increasing their reliance on freelancers, temp workers, and part-timers.
  • Robots have also replaced some American workers.

Job outsourcing helps U.S. companies be more competitive in the global marketplace. It allows them to sell to foreign markets with overseas branches. They keep labor costs low by hiring in emerging markets with lower standards of living. That lowers prices on the goods they ship back to the United States.

The main negative effect of outsourcing is it increases U.S. unemployment. Outsourced jobs are often more than the number of unemployed Americans. If all those jobs were to return, it would be enough to hire millions who are working part-time but would prefer full-time positions.

That assumes the jobs could , of course, return successfully to the United States. Many foreign employees are hired to help with local marketing, contacts, and language. It also assumes the unemployed here have the skills needed for those positions. Would American workers be willing to accept the low wages paid to foreign employees? If not, American consumers would be forced to pay higher prices.

There's not an easy fix. Imposing laws to artificially restrict job outsourcing could make U.S. companies less competitive. If they are forced to hire expensive U.S. workers, they would raise prices and increase costs for consumers.

The pressure to outsource might lead some companies to even move their whole operation, including headquarters, overseas. Others might not be able to compete with higher costs and would be forced out of business. 

American companies send IT jobs to India and China because the skills are similar while the wages are much lower. Companies in Silicon Valley outsource tech jobs by offering H-1B visas to foreign-born workers.  

In the past 20 years, many call centers have been outsourced to India and the Philippines. That's because the workers there speak English. But that trend is changing. Unlike technology outsourcing, there is a much smaller wage discrepancy between call center workers in the U.S. and emerging markets.

Human resource outsourcing reduces costs by pooling thousands of businesses. This lowers the price of health benefit plans, retirement plans, workers’ compensation insurance, and legal expertise. Human resource outsourcing particularly benefits small businesses by offering a wider range of benefits. The Great Recession appears to have kicked off an increase in "domestic outsourcing," where companies outsource functions such as HR to American workers.

President Reagan envisioned NAFTA to help North America compete with the European Union. Unfortunately, it also sent around 850,000 jobs to Mexico. California, New York, Michigan, Texas, and Ohio were the most impacted states. At the same time, however, NAFTA did succeed in lowering prices on many products for American consumers and boosted exports to Canada and Mexico. NAFTA's successor, the U.S.-Mexico-Canada Agreement, was renegotiated to change wage and labor rules and took effect in July 2020.

Mexico is the sixth-largest auto manufacturer in the world, as of September 2021. But did that growth come at the expense of U.S. auto workers? Or is something else the real reason? The truth is Mexico maintains 13 free trade agreements with 50 different countries.

India attracts American companies because its labor force already speaks English. Plus, its universities rank in the top 20% of the world's best, and its legal system is similar to the U.S.

China is the world's largest exporter as of January 2020. But a lot of China's so-called "exports" are really for American companies. A lot of U.S. companies ship raw materials over, and the final goods are shipped back.

Some U.S. companies can only afford to sell products to China’s 1.4 billion people if they manufacture there.

Perhaps the U.S. should do the same thing. Imagine if all our imported products were partly manufactured in America? Other foreign companies should be required to follow the lead of Japanese automakers, who already do this. Of course, if the United States did that, it would mean higher prices for consumers. U.S. workers need a higher salary to pay for a better standard of living.

Workers in many  manufacturing industries  have been replaced by robots. To get new jobs, workers need training to operate the robots.

Innovations in technology are what actually allowed U.S. companies to move call centers to India. If technology is the culprit, it is also the answer. It's made the U.S. more competitive as a nation. Education, rather than protectionism, is the best way to both take advantage of technology and create jobs for U.S. workers.

In 2020, there were 37.2 million people living in poverty in the U.S. Meanwhile, the top 10% of workers earned almost 13 times the income that the bottom 90% of workers earned.

The freelance economy means that companies are laying off full-time—often older—workers and replacing them with part-timers, temp help, ​and freelance workers. It makes it easier to outsource jobs to workers who are not full-time.

The pandemic saw a rapid rise in both remote workers and freelancers, with many businesses expected to sustain or increase their use of freelancers in the future.

The phenomenon of job outsourcing in the United States provokes great economic contention. On one hand, this prevalent practice lowers costs for U.S. companies, enables global competitiveness, and allows them to provide reasonably priced goods and services. The benefits also extend to countries on the outsourced end, many of which have grown their economies through U.S. outsourcing. On the other, it has hurt employment, raising the unemployment rate particularly in these hardest-hit sectors:

  • Manufacturing
  • Call centers
  • Human Resources

Outsourcing may not be the biggest threat to unemployment though. Technological growth in automated intelligence could very well replace many human jobs, enormously impacting the U.S. job market in the immanently near future.

Are foreign jobs ever outsourced to the U.S.?

Although U.S. outsourcing has risen, foreign companies do outsource jobs to the U.S., too. Some experts refer to this as "insourcing." About 8 million jobs in the U.S. were held by Americans who are working for foreign companies in 2019.

How do foreign countries benefit from U.S. jobs being outsourced to them?

Some countries have built strong economies based on outsourcing. This has led to investment in these countries, an improved standard of living for the outsourced workers, and the countries becoming part of the global economy , which could benefit the U.S. in the long term.

What are some U.S. companies that outsource jobs overseas?

Apple , IBM, Google, American Express, and Pfizer are a few of the U.S. companies that outsource jobs to overseas employees.

Bureau of Economic Analysis. “ Activities of U.S. Multinational Enterprises: 2019 .”

U.S. Department of Labor. " Domestic Outsourcing in the United States ," Page 1.

ElgarOnline. " The Effects of NAFTA on US Trade, Jobs, and Investment, 1993–2013 ."

Economic Policy Institute. " NAFTA’s Impact on the States ."

Office of the United States Trade Representative. " United States-Mexico-Canada Agreement ."

 International Trade Administration. " Automotive Industry ."

 International Trade Administration. " Trade Agreements ."

QS Quacquarelli Symonds. " QS World University Rankings 2022 ."

The World Bank. " Exports of Goods and Services (Current US$) ."

U.S. Census Bureau. " China ."

U.S. Census Bureau. " National Poverty in America Awareness Month: January 2022 ."

U.S. Census Bureau. " Table A-4a. Selected Measures of Household Income Dispersion: 1967 to 2020 ," Download Excel table.

Upwork. " Future Workforce Report 2021: How Remote Work is Changing Businesses Forever ."

American Enterprise Institute. " We Hear a Lot About US Jobs Being Outsourced Overseas (‘Stolen’). But What About the 8M Insourced Jobs We ‘Stole’ From Overseas in 2019? "

Magellan Solutions. " US Companies That Outsource Jobs to Foreign Countries ."

27 Eye-Opening Outsourcing Statistics (2024 Update)

  • April 2, 2021

Jessica Edgson

Outsourcing Statistics

As our latest outsourcing statistics will reveal, an increasing number of organizations worldwide are looking to outsource some of their essential and non-essential business functions to third-party businesses to streamline workflow and save on costs. Today outsourcing has become a way of life for many small businesses and large firms. 

In this article, you will find out all there is to outsourcing, including the many benefits of outsourcing, the top countries in terms of outsourced jobs, the market value of this growing industry, the coronavirus impact, and much more. 

But first, be sure to check this list of most intriguing facts on outsourcing: 

Top 10 Outsourcing Statistics for 2024  

  • Around 300,000 jobs are outsourced by the US annually.
  • The top reason for outsourcing (70%) is cost reduction.
  • The total IT budget in 2020 grew from 12.7% in 2019 to 13.6%.
  • 58.8% of US marketers saw no covid-related changes in the outsourcing marketing activities.
  •  Larger companies are 66% more likely to outsource than small businesses.
  • 36% of workers in the US are part of the “gig economy.”
  • The global outsourcing market was worth $92.5 billion in 2019.
  • By 2025, the global IT outsourcing market will be worth $397.6 billion.
  • 83% of IT leaders are planning to outsource their security to an MSP in 2021.
  • 24% of small businesses outsource to increase the efficiency of their business.

General Outsourcing Facts and Stats

The definition of outsourcing is hiring a person who doesn’t work in your company to perform your company’s services. Most companies use outsourcing to reduce costs. Outsourcing can link to various job positions, from IT to customer support. 

This business strategy was first recognized in 1989 . 

1. 64% of leading companies have chosen RPA (robotic process automation) as a digital enabler.

The world-renowned Cloud is just some 4% ahead, with 68% of the leading industries employing Cloud as one of their digital enablers.

Deloitte outsourcing statistics also report that there is no concern over the performance, as it was the case in 2018 when 50% of the surveyed expressed their qualms. However, nowadays the biggest concern revolves around remaining competitive and whether one should go for one digital provider or more.

2. Owing to the pandemic, 48% of businesses worldwide will increase RPA adoption by 5% or more.

(Businesswire) (UiPath)

The post-pandemic challenges will most likely be dealt with through automation, judging by outsourcing statistics. That said, 57% of employers claim that their employees are pretty anxious about these workplace changes. Many of them are afraid they won’t be able to succeed with their work due to automation and stress caused by the pandemic.

75% of the companies are using RPA in order to support the remote workforce.

3. Around 300,000 jobs are outsourced by the US annually.  

When it comes to the United States outsourcing statistics, a large number of jobs are being sent overseas, leaving hard-working Americans without employment. 

4. India’s IT outsourcing industry will witness a CAGR growth of 7.25% by 2025, reaching INR 8,830 billion ($121,335,149.20).

(Outsource Accelerator) (Classic Informatics)

India is the leading IT outsourcing country in the world. Why India? There are many reasons. For example, India has no communication barriers since it’s one of the largest English-speaking countries. Furthermore, outsourcing is far cheaper compared to other developed countries. 

In the same fashion, Indian outsourcing industry statistics imply that by 2023/2024, the country will have the highest number of software developers . India might even overtake the US in this matter. 

5. IBM is the largest outsourcing company in the world.

(Insider Monkey)

IBM has a revenue of $76.5 billion and a market cap of $105.66 billion. In addition to that, based on the outsourcing jobs facts, there are 383,800 people working for this multinational technology giant based in New York. 

The silver medal belongs to Deloitte, a company with a revenue of $47.6 billion. Accenture, a company from Ireland, comes third with $44.7 billion in revenue.

6. The top reason for outsourcing (70%) is cost reduction.  

The second reason is flexibility (40%). Speed to market is important to 20% of businesses. Access to tools and processes and agility matter to 15% of the surveyed, according to Deloitte’s outsourcing statistics graphs.

7. 14.4 million is the number of workers US overseas affiliates hired in 2018.

(The Balance)

The said companies employed people in various sectors, spanning from technology and call centers to human resources and manufacturing. 

8. By the end of 2021, the overall value of outsourced IT services will surpass  $413.72 billion.

(Daxx) (Statista)

The total IT budget in 2020 grew from 12.7% in 2019 to 13.6%. In 2020, middle-sized tech companies were responsible for the largest IT outsourcing industry growth. 

Despite the pandemic, some tech businesses even decided to increase their IT budgets, outsourcing statistics from 2020 show. Others collaborated with their offshore and nearshore IT outsourcing partners.

9. 58% of companies started adopting Artificial Intelligence.

AI is a new rising trend that became accepted by many companies. Based on one survey , 29.4 of workers are expected to undergo additional training as a consequence of intelligent automation implementation. 

On that note, companies that already use RPA are more likely to accept AI adoption.  

10. 58.8% of US marketers saw no covid-related changes in the outsourcing marketing activities. 

U.S. outsourcing statistics from 2020 show only 19.4% of marketers observed a change in the outsourcing marketing activities during the pandemic.

11. 36% of workers in the US are part of the “gig economy.”  

The gig economy is made up of freelancers and people who take short-term contracts in exchange for payment, which also includes freelancers operating in the outsourcing sector.

Freelance statistics show they are very satisfied with the income. In a like manner, the highest paying gig economy job in 2020 was massage therapy. Their average hourly rate was $27.84.

Outsourcing Facts and Figures — Market Value and Cybersecurity

How much is the outsourcing market worth, and what’s the role of cybersecurity?

12. The global outsourcing market was worth $92.5 billion in 2019.

(Statista) (Statista)

Americans had the largest revenue share. As the US outsourcing statistics from 2019 report, its outsourcing market was worth $62 billion. Europe, the Middle East, and Africa were close behind, while the Asian Pacific region had the smallest global revenue share. 

13. $66.5 billion was the global revenue of IT outsourcing in 2019.

But wait, there’s more!

Another $26 billion in global revenue was generated by BPO (business process outsourcing) the same year, according to outsourcing statistics from 2019.

14. By 2026, the global IT outsourcing market will be worth $425.19 billion.

(Statista) (GlobeNewswire)

It’s expected that it will register a CAGR of 4.5% between 2021 and 2026. When it comes to market shares, India will be one of the leading countries. 

Its IT-BPM already helped with the country’s socio-economic growth. What’s more, many leaders in India, political and business, find it to be the country’s future. On that note, Bengaluru is proclaimed as the best city for an IT professional in India. 

Plus, India’s IT outsourcing market is expected to be worth INR 8,830.14 billion ($120.67 billion) by 2025.  

15. 65% of CISOs outsourced 21%–30% of their cyber operations, outsourcing statistics report.

Most of the small and mid-sized businesses don’t have big budgets for cybersecurity. This is where outsourcing comes in handy. About 14% of companies report outsourcing over 50% of their cybersecurity operations. 

16. 83% of IT leaders plan to outsource their security to an MSP (manage service provider) in 2021.

(Security Magazine)

The main reason for this move comes as a result of COVID19. Namely, in 2020, 89% of the surveyed industries had to speed up the digital transformation. Naturally, this led to stretching the existing resources and increased exposure to cyber attacks .

Many companies had cyber challenges, so it’s only logical that these outsourcing trends from 2020 will continue in 2021.

17. The MSP market is to reach $41 billion by 2022 due to outsourcing security functions.

Security operations are the most important cybersecurity services that should be outsourced. Since companies need 24/7 monitoring, the most important outsourcing service is having a security team that will protect all the important data (website, communication channels, database). Equally important is creating the security strategy and security architecture. 

However, if you want to have more control over the decisions, hiring a consultant is a better option than hiring an outsourcer. 

Small Business Outsourcing Statistics

How important is outsourcing to small businesses, and should they hire outsourcers?

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

(Time Doctor)

Exactly why this is so isn’t clear. Yet, it could be that smaller companies (fewer than 50 employees) don’t have the financial means to invest in outsourcing services, unlike bigger companies that have more financial resources at their disposal. 

19. Around 37% of small businesses use outsourcing to handle at least one of their business processes, the latest offshoring statistics indicate.

This could be anything from IT and HR operations to customer service and data protection. 

For instance, accounting and IT services make up 37% of all outsourced jobs, whereas digital marketing makes up another 34%. 

20. 24% of small businesses outsource to increase the efficiency of their business.

Another 18% do so to get expert assistance; 16% do it to be more flexible; lastly, according to outsourcing statistics, 15% do it to give more free time to their employees. 

21. The top three ways outsourcing can help small businesses are — generating profit, growing revenue, and improving cash flow. 

(Neil Patel)

In essence, the top five challenges small businesses face are hiring new employees (50%), increasing profit (46%), employee healthcare (44%), growing revenue (39%), and managing cash flow (34%). 

Generally, by outsourcing, you hit two birds with one stone.  How? Outsourcing eliminates the need for hiring employees and buying employee healthcare while still providing a solid boost to those mentioned above.

Outsourcing Statistics by Industry

Which industry has the most success with outsourcing?

22. Accounting is the most outsourced industry sector.

37% of small businesses outsource accounting and finance . The same percent of businesses outsource IT, while 34% use outsourcing for digital marketing.

23. 24.5% of all organizations are going to increase outsourcing efforts or outsource for the first time in 2021.

Companies that have between 10,001 and 50,001 workers are most aware of how vital outsourcing is. 61.1% of the big companies are ready for the said investment. 

51.6% of businesses with 1,000—10,000 employees are going to do the same.

24. Statistics on outsourcing show 70% of the IT industry market worth will originate from outsourcing by the end of 2021.

Based on the estimations, the IT industry will be worth $413 billion by the end of this year. And guess what? 70% of the mentioned money will come from outsourcing.

Technology is constantly evolving, so companies need to make sure to follow the trend. Over 94% of organizations using IT outsourcing make due improvements by using cloud services.

25. HR consulting is the most common service among HR outsourcing organizations.  

(ExtensisHR)

HR outsourcing statistics imply that HR consulting is the most common service among HR outsourcing organizations (45%). 

The second most common service is benefits administration (36%), followed by time tracking (24%) and insurance services (19%). Only 10% of services are associated with performance management.    

26. 70%–80% of the finished manufactured products are outsourced.

To cut down the costs of labor, numerous manufacturing companies turn to outsource. Based on the outsourcing cost savings statistics, China is the most popular country for manufacturing outsourcing since the labor cost is cheaper . 

In other words, the minimum wage is $162–$358 per month, which means that companies can save 30%–80% . Yet, this is rather higher than in India, where monthly wages vary from $66 to $202.

27. When it comes to the banking industry, 40% of help desk positions are outsourced.

Help desk specialists maintain the relationship between the company and the customer. They also help customers with questions and technical support. On top of that, 85% of customers are willing to pay more money to receive an improved help desk experience. 

How common is outsourcing?

(Outsource Accelerator) (Clutch)

Outsourcing is incredibly common. Over one-third of small businesses use outsourcing to help them become more efficient, increase their skill, and give their employees more free time. 

In fact, many companies (small and big) use outsourcing to reduce their costs and have more flexibility. India is the leading country globally when it comes to IT outsourcing, followed by the Philippines and the US. 

What percentage of US companies outsource?

(Outsource Accelerator)

68% of US companies outsource to low-cost countries. The most outsourced services are accounting, IT service, digital marketing, development, human resources, and customer support. 

The biggest US outsourcing company is IBM which currently has 383,800 employees, a revenue of $76.5 billion, and $153.4 billion in assets. Deloitte holds second place, with a $47.6 billion revenue and 330,000 employees.

What percentage of American jobs are outsourced?

While there is no definitive answer — keeping track of outsourcing contracts at any moment is incredibly difficult. What we do know, however, is that each year around 300,000 jobs are being sent overseas. 

In other words, that’s a huge chunk of US jobs being handed over to other countries.

Which countries outsource the most?

The US is the leading outsourcing country as it made 84.2% of outsourcing deals in 2017. The UK and Australia take second place on the leading outsourcing markets list. 

In terms of the top countries where work is being outsourced, we have India with its IT specialists. Next, the Philippines, which specializes in customer service roles . 

Ukraine and Poland are also becoming popular, especially in the IT sector. On the other hand, China is the most popular country for manufacturing outsourcing .

How much has outsourcing increased?

Quite a bit. In 2015, it sat at $88.9 billion, only to drop to $76.9 billion in 2016. In 2017, it climbed back to $88.9 billion, then dropped to $85.6 billion in 2018 before rising to $92.5 billion in 2019. 

The market statistics show it fluctuated quite frequently over the past five years. 

Is outsourcing increasing or decreasing?

Due to the pandemic, the outsourcing industry is expected to increase. 

First of all, since companies started to incorporate a remote working model, people have become more comfortable with virtual meetings, interviews, and hiring. 

Secondly, the companies are trying to preserve their money due to the economic crisis, leading them to turn towards outsourcing. 

And lastly, outsourcing is still one of the essential tools for client organizations and strategies. 

How big is the outsourcing industry? 

The global outsourcing industry was worth $92.5 billion in 2019. The reports show us that we can expect it to reach $114 billion by 2025.

Therefore, the outsourcing industry is pretty big. In fact, along with the oil and gas, the outsourcing industry is one of the biggest benefactors to the global economy. 

By now you should have a much better understanding of why companies outsource. 

Whether they be budding startups or large corporations, the target goals are the same — cutting costs, working on core business functions, getting expert help, and so on.

Hopefully, our outsourcing statistics, as well as our general overview of global outsourcing companies, satiated your curiosity and gave you more insight into how the outsourcing market works. 

  • Businesswire   
  • Classic Informatics  
  • Deloitte   
  • ExtensisHR   
  • GlobeNewswire  
  • Insider Monkey   
  • Outsource Accelerator
  • Security Magazine   
  • Statista   
  • The Balance
  • Time Doctor

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Jessica is a writer and editor from Cape Town, South Africa. She started her journey studying journalism and media studies, along with English literature. Since then, she’s written for many different websites on a number of subjects. She loves any topic that she can really sink her teeth into, and she makes sure that everything she writes is thoroughly researched.

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outsourcing jobs 2022

Home > Blog > From ‘The Great Resignation’ to Labor Shortage: Top 6 Factors That Will Spur Outsourcing Growth in 2022

From ‘The Great Resignation’ to Labor Shortage: Top 6 Factors That Will Spur Outsourcing Growth in 2022

Top 6 Factors That Will Spur Outsourcing Growth in 2022

Is the outsourcing industry growing? The answer is a straightforward “yes.” Outsourcing growth has been tremendous these past few years. In 2021, the global outsourcing market was valued at $245.91 billion. 

As the United States and the rest of the world reemerge from the pandemic, outsourcing will continue to make tidal impacts across industries. The global BPO industry is expected to grow up to $405.6 billion by 2027, at a CAGR of 8.0%. 

This article will look into triggers propelling outsourcing growth in 2022. But first, let’s take a quick look at how big the outsourcing industry is in the U.S.

Interesting Statistics in Outsourcing:

  • More than a third of small businesses outsource various functions.
  • 68% of large consumer product companies in the U.S. outsource a portion of their workforce. 
  • Among the most commonly outsourced tasks are accounting (37%), information technology (37%), and digital marketing (34%). 

What Industries Outsource the Most?

  • Information Technology – The global IT outsourcing market is expected to be worth $397.6 billion by 2025. 
  • Financial Services – About 71% of financial service executives outsource certain functions.
  • Customer Service – The value of the customer experience market is expected to reach $81.5 billion by 2023.
  • Retail – About 70% of retailers and manufacturers outsource specific services. 
  • Healthcare – Prompted by the increase in telehealth demand, the global healthcare outsourcing sector will reach $229.2 billion by 2025.

Read more: Top 5 US Companies That Found Success Through Outsourcing Services in the Philippines

6 Significant Events Driving Outsourcing Growth in 2022

#1: worker shortage in the us.

The high demand for talent in the U.S. far exceeds the supply. In November 2021, more than half a million jobs became available, yet the labor shortage persists . Some of the factors that contributed to the vast talent gap are the following:

The ‘Great Retirement’ of Baby-Boomers 

For the longest time, employees born between 1946 to 1964 have represented the largest fraction of the working population. Their retirement from the workforce is widely felt across industries. 

In 2019, about 34 million members of the Silent Generation retired from the workforce. Another 30 million baby boomer retirees followed in the third quarter of 2020. This trend meant that about 10,000 members turn 65 daily and enter their golden years. Analysts foresee this rate to remain constant until 2030. 

Record-Low Participation Rates Among the Working-Age Population

Amid the recession-free decade, the U.S. has seen a steep decline in labor force participation. After reaching its peak at the turn of the 21st century, the population of the country’s workers has shrunk consistently. The national labor force participation rate has dipped from 64.4% in 2010 to 63.6% in 2019.

Among the reasons for the downward trend are:

  • The dramatic change in the U.S. population’s age distribution 
  • The continuous rise of the cost of child care 
  • An increasing number of people dissatisfied with the prevailing wage rate

The Lowest Birth Rates in the U.S.

In 2020, the U.S. saw its birth rate declined for the sixth consecutive year. The country also recorded the lowest number of newborns since 1979, following a 4% decrease. Low birth rates are supposed to impact a country’s economy positively. However, this will only be the case if a larger share of the population is comprised of the working age.  

#2: ‘The Great Resignation’

In recent years, the U.S. has seen many record highs and lows. But perhaps the most significant trend causing ripple effects across other economic activities is the record-high number of resignations in the country.

In 2021, a record-high number of employees in the U.S. voluntarily quit their jobs. The recent data shows that in the last business days of November 2021:

  • 4.5 million workers resigned
  • 10.6 million jobs opened 
  • Only 6.7 million employees were hired 

Will the Acute Talent Shortage Drive the BPO Industry’s Growth?

Economists foresee the talent shortage to persist for years, even permanently. For this reason, many believe that more U.S. companies will turn to outsourcing for growth. Even before COVID, U.S. businesses have been relying on offshore outsourcing to address the gap in labor supply and demand. As there is still a massive surplus of skilled global talents in known outsourcing destinations like the Philippines, outsourcing will likely grow further in the future.

Read more: What Businesses Can Learn From ‘The Great Resignation’: Top 5 Key Takeaways and 20 Powerful Statistics

#3: Immigration to the US Is Slowing

For decades, immigration has played a significant role in the economic vibrancy of the U.S. International migration activities have helped offset birth rate decline, augment the country’s labor force growth, and catalyze the development of various regions . Recent data, however, show a considerable decrease in the country’s immigrant population. 

A report from the U.S. Census Bureau showed that the country averaged only about 200,000 net international migration annually from 2017 to 2019, about 450,000 short of the yearly average of 650,000 from 2010 to 2017. The steep decline in immigration threatens to hamper the country’s economic recovery. According to 91% of state and local chambers of commerce , the labor gap is holding economies back. 

To address the issue, the U.S. Chamber of Commerce launched the “America Works Initiative,” a campaign aiming to grow the country’s workforce. Among the call to actions is to increase employment-based immigration. 

Apart from seeking immigrant workers, employers respond to the call by tapping a wider pool of talents available offshore through outsourcing initiatives. More than 93% of businesses have adopted or are considering adopting cloud solutions to strengthen outsourcing efforts.

6 Factors Driving Outsourcing Growth in 2022

#4: The 32-Hour Workweek

Another reason to believe outsourcing will grow in the future is the possible standardization of the 32-hour workweek . Amid the clamor to give workers a more balanced lifestyle, progressives in Congress are backing the reduction of the current national workweek standard from 40 hours to 32. Certain employees who exceed the 32 hours will be entitled to overtime pay.

While this 32-hour workweek appeals to top talent and possibly curb “The Great Resignation,” it poses numerous downsides for organizations. Among these is the possible decline in the level of customer service since fewer hours means less availability of support for customers. The overtime pay mandate could also deplete the financial resources of the companies. 

Despite the downsides, there are also many benefits that businesses can get from shortening work hours. It teaches employees to find ways to be more productive and increases engagement and positivity. 

The key is for businesses to balance things out to achieve the best possible outcome. One way to accomplish this is to help onshore employees maximize their work hours by outsourcing non-core activities offshore. This insight from a Forbes article explains why startups and SMEs should consider embracing outsourcing for growth:

“One important lesson learned by many companies during the pandemic was to focus on what they do best and to bring in experts when specific solutions are needed.”

Read more: ‘The Great Resignation’ and the 32-Hour Workweek Act: How Offshoring Could Offer the Ideal Compromise

  #5: Funding Challenges Among Startups and SMEs

During the onslaught of the pandemic, many businesses realized the efficiency and significant cost advantage of outsourcing offshore. Supply chain challenges increased customer service demand, prompting SMEs to outsource customer support solutions. Today, the strategy proves to be even more vital. 

As businesses worldwide grapple with reemerging from the impacts of the pandemic, changes are unfolding at an unprecedented speed. The need to innovate and pivot faster is more important than ever. However, many startups and small businesses lack the resources to scale rapidly. According to a survey conducted by AIN, 85% of startups are having difficulties raising investments. 

Outsourcing Among Startups: One of the Biggest Future Trends in Outsourcing 

Business analysts foresee that many startups and SMEs will embrace outsourcing. The strategy has enabled businesses of all sizes to reduce costs, enhance agility, and improve service quality. In addition to customer service, outsourcing’s growth will further be seen in marketing, human resources, and accounting.    

#6: Minimum Wage Hike in the US

Primarily prompted by stiff competition for talents and high turnover rates, wages and compensations in the U.S. ascend. More than 80 states, cities, and counties have increased their minimum wage this year, recording the highest uptick in more than a decade. For employers, the wage hike means an average of 3.9% increase in payroll costs .

There will likely be a sharp increase in businesses that will engage a third-party service provider offshore to offset the additional payroll costs and maintain profitability. Cost reduction has always been among the significant benefit enjoyed by businesses that outsource. According to a Deloitte survey, cost advantage is the main reason why 70% of companies outsource business functions .

Will Outsourcing Grow in the Future?

The offshore outsourcing sector has become among the solid pillars of the modern U.S. economy. From the Great Recession of 2008 to the recent global health crisis, outsourcing has helped many businesses weather economic downturn—some even thrived. 

As the U.S. and the rest of the world enter an era where changes, innovation, and adaption will be permanent, we have reasons to believe outsourcing will grow in the future . In fact, some countries specializing in providing outsourcing solutions have already seen an upward trend in their BPO sector’s growth.  

Bigger-Than-Expected Philippine BPO Industry Growth 

The Philippines has always been America’s preferred outsourcing partner. Today, amid the unstable labor market and wage hike concerns, the U.S. continues to recognize the Asian country’s contribution to the stabilization and expansion of the U.S. economy. Proof of this is the continued growth of the outsourcing industry in the Philippines. 

The country’s BPO outsourcing receipts grew by 8.3% during the first nine months of 2021, exceeding the earlier projection of 5% and surpassing the forecasted performance for the entire 2021. Indeed, the Philippines remain the top outsourcing partner of choice among U.S. businesses that want to thrive amid unprecedented challenges and disruptions.    

Read more: 10 Reasons Why US Companies Outsource Customer Service to the Philippines

Choose Your Ideal Outsourcing and Growth Partner in the Philippines

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The top 20 companies on a hiring spree for remote workers this year

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2022 is kicking off with as tight of a job market as ever, and workers are looking for jobs with more flexibility.

To help people narrow their search, FlexJobs, a membership service for jobseekers, released its latest report of the top 100 companies hiring remote jobs in 2022 , taking into account some 57,000 companies who list their openings on the job site.

New to the list this year are HubSpot, Mayo Clinic and Stitch Fix, while several major employers have consistently made the top 100 since the report began nine years ago: Anthem, Inc., CVS Health, Dell Technologies, Kelly, Parexel, SAP, Stride, Inc., and UnitedHealth Group.

Each company is hiring "hundreds, if not thousands, of remote jobs in a given year," FlexJobs career services manager Brie Reynolds tells CNBC Make It .

FlexJobs saw a 12% increase in the number of remote job listings in 2021 over 2020, with notable growth in accounting and finance, as well as HR and recruiting roles that can be done partially or fully from home. Nearly 30% of listings are for jobs at a manager or senior level.

"People are actively interested in continuing to work remotely," Reynolds says. Just look at the record levels of people quitting low-paying, inflexible jobs during the Great Resignation, she says. "As remote work has continued, employers are seeing more of what it could look like and how it could work in the long-term."

Here are the top 20 companies hiring for remote jobs in 2022, according to FlexJobs, along with the full list of the  top 100 companies here .

1. BroadPath

Headquarters:  Tucson, Arizona

Industry:  Outsourcing

Remote jobs : Director of operations, director of sales, compliance auditor

Headquarters:  Scottsdale, Arizona

Industry:  Virtual call center

Remote jobs : Instructional designer, community director, business intelligence analyst

Headquarters:  Tampa, Florida

Industry:  Customer service

Remote jobs : Bilingual Spanish/English customer support agent

4. Working Solutions

Headquarters:  Plano, Texas

Remote jobs : Senior living customer care, educational sales consultant

U.S. headquarters:  Newtown Square, Pennsylvania

Industry:  Enterprise software

Remote jobs : Paid search strategist, software engineer

6. Varsity Tutors

Headquarters:  St. Louis, Missouri

Industry:  Education

Remote jobs : Director of training and development, HR coordinator, senior engineering manager

Headquarters:  Englewood, Colorado

Remote jobs : Senior corporate counsel, consultant, senior financial analyst

8. Kelly/KellyConnect

Headquarters:  Troy, Michigan

Industry:  Staffing

Remote jobs : Technical support representative

9. Williams-Sonoma

Headquarters:  San Francisco, California

Industry:  Retail

Remote jobs : Creative director

10. TranscribeMe

Industry:  IT services

Remote jobs : Transcriptionist

11. Robert Half International

Headquarters:  Menlo Park, California

Industry:  Staffing and consulting

Remote jobs : Customer service agent, consultant, accounting manager

12. Transcom

Headquarters:  Stockholm, Sweden

Remote jobs : senior manager of customer experience, director of digital customer experience

13. Dell Technologies

Headquarters:  Round Rock, Texas

Industry:  Technology

Remote jobs : Outside sales product specialist, account executive

14. UnitedHealth Group

Headquarters:  Minnetonka, Minnesota

Industry:  Health care

Remote jobs : Customer care service navigator, case manager, recruiter

15. Sutherland

Headquarters:  Pittsford, New York

Industry:  IT and business services

Remote jobs : Team manager, associate

16. Change Healthcare

Headquarters: Nashville, Tennessee

Remote jobs : senior sourcing specialist, product application support representative, product lead

17. Thermo Fisher Scientific

Headquarters:  Waltham, Massachusetts

Industry:  Biotechnology

Remote jobs : Senior developer, senior program manager

18. Cactus Communications

Headquarters:  Mumbai, India

Industry:  Communications

Remote jobs : Scientific writer, editor

19. Parexel

Headquarters:  Newton, Massachusetts

Industry:  Biopharmaceutical services

Remote jobs : Consultant

20. CVS Health

Headquarters:  Woonsocket, Rhode Island

Remote jobs : Clinical pharmacist, senior informatics consultant lead, pharmacy technician

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The future of outsourcing

Next-generation outsourcing deals move beyond cost-cutting and enable true business transformation.

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60% of organizations are either considering or planning to assess their outsourcing strategies in the next 12 months. That’s a clear sign outsourcing has evolved into a true business transformation solution.

The reasons for outsourcing may vary – changing workforce habits, new technologies, attracting new talent. However, the end goal for everyone has to be future-focused, prioritizing deals and relationships that are less transactional and more transformational to drive value and operational excellence. All these trends and more are covered in our newest report “The Future of Outsourcing.”

It’s one resource you can rely on as you continue your digital transformation. You also need the right partner. KPMG has specialized teams of experienced outsourcing professionals ready to help. Let’s set up some time to talk about your unique needs and work together toward a successful future.

Dive into our thinking:

Next-generation outsourcing deals move beyond cost-cutting and enable true business transformation

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KPMG 2023 Global Procurement Survey: A critical year ahead

Procurement leaders face complex risks and opportunities that require a focus on strategic sourcing, technology, and sustainable goals.

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The remote revolution could lead to offshoring Armageddon

Globalization crushed blue-collar jobs throughout the rust belt. now some urban professionals could be poised for a similar fate..

outsourcing jobs 2022

When offshoring methodically disemboweled the Rust Belt, white-collar Americans thrived, free to enjoy the spoils of globalization safe in the knowledge that their jobs could not be outsourced easily to cheap foreign rivals. Now, some economists say the remote-work revolution may have changed that almost overnight.

“If you can do your job from home, be scared. Be very scared,” Richard Baldwin, an economist at the Graduate Institute in Geneva, said in a recent video . “Because somebody in India … or wherever is willing to do it for much less.”

Department of Data

outsourcing jobs 2022

By greatly accelerating the adoption of remote work, the coronavirus pandemic has created a feedback loop that could be the most disruptive force to hit the job market since the blue-collar apocalypse in the 2000s, known among economists as the China shock .

The rise of China as the world’s factory lifted hundreds of millions of people out of poverty worldwide and deluged consumers with cheap goods. But it also devastated local manufacturing economies in such places as Hickory, N.C., Tupelo, Miss., and Springfield, Mo., and sparked a backlash that ultimately would help carry Donald Trump to the Oval Office.

There’s no telling whether the remote revolution will cause similar social upheaval. Many economists are optimistic that American workers will land on their feet amid a gradual transition from a world in which they compete with a few dozen locals for each new job to one in which they compete with a few million professionals worldwide. But economists were optimistic about Y2K-era globalization as well, and it seems wise to keep a wary eye on the possible downside.

We’ve chronicled how remote work is reshaping America , but there’s been less focus on how the remote-work boom has removed one of the biggest barriers to outsourcing for small businesses. As the pandemic forced them to go digital and become adept at managing a distributed workforce, some bosses consider outsourcing to be the logical next step — especially as wages soar and workers remain scarce.

Companies already are turning increasingly to contractors vs. full-time employees. Relative to workforce size, the number of contractor payments in the United States skyrocketed 56 percent from 2019 to earlier this year, according to data provided exclusively to The Post by the payroll and benefits firm Gusto. By June, the 200,000-plus businesses on Gusto’s platform averaged almost two contractor payments for every employee they had on the payroll. In some industries, it’s even higher.

“The pandemic became a very volatile time, and lots of businesses needed to pivot on very quick timelines,” said Liz Wilke, principal economist at Gusto. “And they also needed skills and capabilities that they didn’t have before or could not get in the talent market. And that is the primary advantage of contractors.”

Brian Zielinski is riding square atop the outsourcing wave. He co-founded and runs ShapeConnect, which matches companies with vendors who can help outsource or automate certain jobs. They’re doing record business, matching more than 200 American small and midsize businesses with suppliers in the most recent quarter.

Since the pandemic, Zielinski has seen soaring interest from smaller construction and manufacturing businesses — companies that might have been doing their customer and project management on paper or in simple spreadsheets before the pandemic but are now scrambling to go fully digital.

How a four-day workweek could be better for the climate

“I think people are looking for the flexibility now of outsourcing personnel versus hiring,” Zielinski said. He added that customers are reluctant to commit to full hires given the shakiness of the economy and the two-plus years of unprecedented uncertainty through which we’ve all just lived.

Zielinski said ShapeConnect doesn’t work with overseas providers, since most clients prefer contractors in the United States and Canada who share similar time zones, language and culture. But economists like Baldwin say those barriers are already breaking down as rapid technological improvements make it increasingly easier to cross time zones and language barriers.

“American companies can hire people all over the planet. And they will,” said Mark Zandi, podcaster and chief economist at Moody’s Analytics . “That’ll become increasingly more prevalent as technology improves and companies that form optimize around remote work. They’re not going to form around office cubes; they’re going to form around a remote work dynamic.”

Convincing businesses to decentralize their technology used to be like pulling teeth, said Adam Barney, president of Framework IT, a Chicago firm that helps businesses across the country outsource technology management and move their operations to the cloud. Many clients clung to offices stuffed with server racks, phone lines and other hardware — until the pandemic hit.

The transition to a cloud-based, remote-friendly operation is no longer in question. As clients race to catch up, Framework’s monthly recurring revenue is up 85 percent from pre-pandemic levels, and order sizes have soared more than 140 percent. Companies of all sizes are newly comfortable with workers clocking in from anywhere.

“We’re even seeing many organizations actually say, ‘We’re going to be a virtual-first organization moving forward. We are going to get rid of an office when our lease is up. We are never going to go back to that,’” Barney said.

Economists we spoke with all believe the white-collar job market will go global, but they differ greatly on whether the shift will be measured in years or in generations. That timetable matters: It’s the difference between a gradual transition and “ American carnage .”

If we assume the change is imminent, and look at our best estimates of where the most easily remote-able jobs were just before the pandemic, we see the remote revolution would be almost the inverse of the China shock, which destroyed the careers of many less-educated factory workers. As a rule, the more a job pays, the easier it is to do remotely, according to a Washington Post analysis of Labor Department data on jobs that had to go remote during the pandemic.

The highest-paying industries, software and internet publishing (including search and social networking), also have the highest share of remote workers. A similar pattern holds throughout the income scale, with the lowest-paying jobs — in places such as gas stations — being least likely to be done remotely.

To understand which areas would suffer most if those jobs went overseas, we analyzed data from the economists at WFH Research , which allows us to look at all remote-capable jobs, not just those effected by the pandemic. It also allows us to exclude hybrid jobs, which presumably will be harder to do from overseas.

In this nightmare scenario, our analysis found that the nation’s richest urban centers would also be its most vulnerable. Cracks have already appeared in the gilded metropolises of New York and San Francisco, where the urban cores are losing population as remote and hybrid workers flee to more affordable and amenable outlying communities. The losses would compound if those jobs were to go overseas.

And while those jobs are concentrated in urban areas, many of them coastal, no industry or region would be untouched. As Zielinski points out, even blue-collar industries such as construction or manufacturing have plenty of white-collar roles that can be outsourced — think marketing, accounting, finance, sales and IT.

The nation’s white-collar jobs are more spread out than the manufacturing jobs concentrated in single-industry factory towns that lost everything to China, said the Massachusetts Institute of Technology’s David Autor, the slide-deck-slinging nerd superstar who first described the China shock with his collaborators David Dorn and Gordon Hanson.

And while Autor says he sees parallels between blue-collar workers eviscerated by the China shock and the white-collar workers who might soon be blindsided by global competition, he believes this will be more of a “little ripple or a little jolt rather than a shock,” since white-collar work simply isn’t a commodity that can be easily swapped across borders.

“If you move machinery between here and China, the machinery more or less works the same way,” Wilke said, “and that’s not necessarily true of knowledge-based industries. It’s too soon to tell.”

Indeed.com ’s Nick Bunker pointed out that remote work seems to be going more local than global in the short term, as many “remote” jobs in the United States are quickly becoming hybrid, with workers coming in a few days each week. A recent Gallup poll found a sharp increase in hybrid work in 2022, with 49 percent of remote-eligible jobs being hybrid in June, up from 42 percent in February. In the long run, Gallup estimates, just 22 percent of remote-eligible jobs will be fully remote, while 55 percent will be hybrid.

Similarly, Barney, the IT firm president, says his clients typically bring up offshore outsourcing only to make sure he’s not doing it. With rising uncertainty around the coronavirus and the war in the Ukraine, clients are increasingly interested in cybersecurity and consider it unacceptably risky to expose critical business functions to the vagaries of geopolitics.

Autor, Zandi and other economists say those full-remote jobs could ultimately be a positive for American white-collar workers, liberating them from high-cost urban areas and revitalizing small communities.

“In global remote labor markets, U.S. workers earn a premium and are more likely to be hired,” said Adam Ozimek, who has extensively analyzed remote work as chief economist at Upwork and now the Economic Innovation Group. “Part of it, I believe, is that the U.S. is the most important consumer market in the world, and accessing workers who understand this market best is incredibly valuable.”

In areas beyond the reach of the U.S. market, though, economists are less confident that American workers will steal jobs from their more-affordable overseas peers.

“I don’t see highly talented U.S. workers competing for jobs in France or Singapore, unfortunately, because Americans are so resolutely monolingual. French and Singaporean workers will benefit more from remote access to U.S. jobs than will U.S. workers to remote access to jobs in Europe or Asia,” MIT’s Autor told us.

The China shock devastated such places as Dalton, Ga., in part because a high school-educated carpet factory worker had few other options once the biggest employer in the only hometown she’d ever known had closed down.

But white-collar workers who lose remote jobs to global competition will find themselves with more options, Ozimek and other economists said. Educated workers are already better at landing on their feet in the United States — they’re more mobile and more marketable. And the new remote-work market will make it even easier, allowing them to apply for jobs throughout the country.

Of course, that may do little good if we rapidly reach a place where most white-collar jobs can be done more cheaply overseas.

In the near term, there’s little evidence to suggest a sudden exodus of jobs offshore. In fact, companies have been moving blue-collar jobs back to the United States. But Baldwin, author of a recent book on the globalized and automated future of work , says there are already pockets of white-collar offshoring, and they could expand rapidly once technological advances wipe away linguistic and logistical barriers, since bits and bytes move freely and instantly across borders.

Stanford economist and remote-work prophet Nicholas Bloom said any wave of white-collar outsourcing in the service sector wouldn’t begin until the pandemic has abated and executives can freely travel abroad once more.

“Right now, that’s not so easy to do as if you want to outsource to say, Mexico. You need to take a few trips there first to scope the place out,” Bloom said. “But give it two or three years and we will be looking back at 2020 as the turning point for service-sector globalization.”

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40+ Vital Outsourcing Statistics [2023]: How Many Jobs Lost To Outsourcing?

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Research Summary. With more and more businesses across the U.S. looking for ways to increase profit margins and cut costs, outsourcing has become a popular business tool for both big and small companies across the nation.

To find out more, our data analysis team gathered an extensive list of United States outsourcing statistics. According to our extensive research:

Roughly 300,000 U.S. jobs are outsourced each year.

The global outsourcing market is valued at $92.5 billion , with the U.S. market bringing in $62 billion of the total international revenue.

66% of businesses in the United States outsource at least one department.

59% of businesses cite cost as the biggest reason for outsourcing.

Information technology is the leading industry and business department for outsourcing — 13.6% of the average IT department budget dedicated to outsourced tasks and about 37% of IT tasks are outsourced.

Globally, 78% of businesses that outsource work across the globe have a positive attitude towards their outsourcing partners.

The outsourcing market is expected to grow at a compound annual growth rate of 4% between 2021 and 2025.

Nearly a quarter (24%) of small businesses outsource to increase efficiency.

global market size of outsourced services by revenue 2000-2019

General Outsourcing Statistics

68% of large consumer products companies in the United States outsource a portion of their workforce.

More than two-thirds of big companies in the United States use outsourcing to some degree. Primary reasons for outsourcing included tight budgets and rising energy costs.

Companies across the nation hired more than 2 million outsourced workers in the 2000s.

Outsourcing exploded in the 2000s. During that time, U.S. companies cut their American workforces by roughly 2.9 million and used outsourcing to hire 2.4 million workers overseas, according to the CAP.

The global outsourcing service market is valued at more than $90 billion.

The international outsourcing market is valued at $92.5 billion as of 2019, with $62 billion generated through companies in the United States.

Most global outsourcing revenue is generated through the information technology sector.

$66.5 billion was generated by information technology outsourcing, and $26 billion was generated by business process outsourcing, in 2019.

Large multinational companies are the biggest proponents of outsourcing, especially overseas.

35% of large multinational companies headquartered in the United States added jobs faster than smaller companies in the country between 2010 and 2012, according to the WSJ. However, roughly three-fourths of the added jobs were outsourced overseas.

China is the top country the United States outsources to.

The U.S. outsources to China more than any other country. In addition, China’s outsourcing market grows by 30% every year. Behind China, The Philippines, Taiwan, Ukraine, and Vietnam are among the top 5 countries U.S. businesses outsource to.

About 300,000 US jobs are outsourced each year

Outsourcing Statistics by Jobs Lost to Outsoucing

Roughly 30 million jobs are vulnerable to outsourcing.

More than one-fifth of jobs in the United States have the potential to be lost to outsourcing, according to a Princeston study.

Technology outsourcing represents the biggest outsourcing market in the world.

International technology outsourcing generated a whopping $66.5 billion in 2019. For comparison, business process outsourcing generated $26 billion.

Information technology departments are the most typically outsourced department in the United States.

It’s estimated that 92% of organizations in North America engaged in information technology outsourcing, to some extent, in 2019.

High-paying industries that require advanced education and a refined skill set are among the top 10 industries that get outsourced overseas.

Computer programmers, data entry keyers, electrical and electronics drafters, mechanical drafters, and computer and information personnel are the top five occupations most vulnerable to outsourcing. Annual wages for the occupations lie between $26,350 and $100,640.

The report also listed actuaries, mathematicians, statisticians, mathematical science occupations, and film and video editors among the top ten U.S. careers most likely to get outsourced overseas.

Outsourcing Statistics by Company Size

80% of small businesses plan to outsource at least some of their work in 2022.

8 in 10 small businesses in the United States plan to outsource work this year to save their organization time and money.

Large businesses are 128% more likely to outsource work than small businesses.

29% of businesses with 50 or fewer employees outsource work compared to 66% of businesses with more than 50 employees.

More than half of America’s large businesses outsource.

Data illustrates that 68% of large consumer products companies in the United States use outsourcing.

Accounting and information technology are the most commonly outsourced departments among small businesses.

Among small businesses that outsource, 37% outsource either accounting or IT services work, 34% outsource digital marketing work, 28% outsource development work, and 24% outsource either human resources work or customer support work.

most commonly outsourced tasks and departments

71% of financial service executives outsource one or more services.

Outsourcing Statistics by Most Common Reasons

59% of businesses outsource to cut costs.

More than half of all global companies that rely on outsourcing do so to save money. A global survey revealed that the majority of respondents said their company uses outsourcing as a cost-cutting tool.

26% of small businesses outsource to get help from an expert.

More than one-quarter of small businesses with ten or fewer employees outsource to experts to get business advice or help to complete specialized tasks.

For comparison, 17% of businesses with 11 to 50 employees, 14% of businesses with 51 to 250 employees, and 16% of businesses with 251 to 500 employees outsource to get help from an expert .

expert outsourcing by company size

Outsourcing can cut labor costs by up to 90%.

Overseas outsourcing can help U.S. companies save 70% to 90% in labor costs. The biggest savings are seen when work is outsourced to countries with a low cost of living, like the Philippines.

Outsourcing Statistics Trends and Projections

The international outsourcing market has grown by $15.6 billion since 2016.

Based on data compiled in 2019, the global outsourcing market is currently valued at $92.5 billion. While revenue from outsourcing has been up and down for the past few years, the market was worth an estimated $76.9 billion in 2016. As such, the industry grew by $15.6 billion between 2016 and 2019.

The overall outsourcing market is expected to grow at a compound annual growth rate of 4% between 2012 and 2025.

Experts predict the overall international outsourcing market to increase at a CAGR of 4% over the next four years. At that rate, the market is on track to grow by $40.16 billion by 2025.

8 million American manufacturing jobs were outsourced between 1979-2009.

While outsourcing grows, some industries are suffering in the U.S. Outsourcing has taken a toll on the American manufacturing industry in particular. The manufacturing market lost 8 million American workers between 1979 and 2009, with roughly 19.5 million jobs in June 1979 and only 11.5 million in December 2009.

Additionally, manufacturing plants have declined by 12.5% between 1998 and 2008, with 51,000 plants closing their doors across the country.

Despite increasing costs, few American companies (4%) plan to relocate outsourced jobs back to the United States.

While the cost gap between the United States and China is decreasing (meaning that outsourcing costs are increasing), few companies plan on bringing jobs back to the U.S. Only 4% of large American companies plan to bring outsourced jobs back to the United States according to a Duke’s School of Business survey.

70% of surveyed companies plan to outsource more work in the near future.

The large majority of companies plan to outsource more in the future. Moreover, 35% plan to significantly increase the number of jobs they outsource.

38% of the predicted global outsourcing market growth will happen in the United States.

More than one-third of outsourcing market growth will be tied to the United States. Information technology and telecommunication outsourcing are expected to lead market growth.

The number of U.S.-based freelancers grew by 22% between 2019 and 2020.

The number of working freelancers in the United States is growing rapidly, primarily fueled by younger professionals seeking flexible work opportunities. The American freelance workforce contributed $1.2 trillion to the U.S. economy between 2019 and 2021.

Outsourcing Statistics and the Economy

In terms of value, 84.2% of outsourcing deals originate in the U.S.

Most outsourcing deals originate in the United States, when we look at the actual value of the work being done. The second most valuable generator of outsourcing is the United Kingdom, generating 5.2% of global outsourcing deals.

42% of global outsourcing deals come from North America and South America.

The United States is the leader of outsourcing in the Americas, and, according to a global report from KPMG, 42% of international outsourcing is tied to North America and South America.

For comparison, the report estimates that 35% of outsourcing comes from Europe, the Middle East, and Africa, and 23% of outsourcing comes from Asia and Oceania.

Computer and mathematical occupations are the top jobs being outsourced in the U.S.

According to labor statistics, computer and mathematical occupations in the U.S. are almost equal to the amount of computer and mathematical occupations offshored from the U.S.

The U.S. Bureau of Labor Statistics reports that other top jobs are being outsourced, including business and financial operations occupations, architecture and engineering occupations, legal occupations and sales, and other related occupations.

Outsourcing Statistics by Benefits and Issues

Most business executives are satisfied with outsourcing because of financial benefits.

Roughly 59% of businesses are happy with outsourcing work because it saves money and is an effective cost-cutting tool.

Roughly one-third of working professionals resist outsourcing.

Research shows that about 33% of professionals do not support outsourcing due to fear of losing their job. In addition, employees working for companies that outsource report a 66% increase in job insecurity.

Outsourcing from other countries creates more work in the United States.

While the U.S. largely outsources its work to developing countries to cut back on costs, more and more developing countries have been outsourcing work to the United States and other developing economies as a means of gaining access to top global markets.

17.49% of work outsourced to developed economies comes from Argentina. Behind Argentina, Thailand, Mexico, Egypt, China, Pakistan, India, Turkey, Saudi Arabia, and Nigeria are the biggest outsourcers to the U.S. and other developed nations.

outsourcing developing countries

Outsourcing FAQ

What is outsourcing?

Outsourcing is the process of relocating a company’s internal duties to an external party. There are two types of outsourcing: business process outsourcing, or BPO, and information technology outsourcing, or ITO.

Business process outsourcing relocates business operations to a service provider or company outside the organization. Information technology outsourcing refers to outsourcing a company’s IT needs and responsibilities.

Outsourcing is very often associated with offshoring, the process of relocating a company’s jobs overseas. Companies most often outsource jobs offshore in an effort to save money and resources. In 2019, India was considered the best country for offshoring.

What is the success rate of outsourcing?

What percentage of U.S. companies outsource?

What percentage of American jobs are outsourced?

What countries outsource the most?

For businesses across the United States and worldwide, outsourcing is a tool for cutting costs, increasing efficiency , and completing specialized tasks. With roughly 66% of American companies outsourcing jobs, the country generates an impressive $62 billion of the outsourcing market’s $92.5 billion global value.

Although outsourcing often equates to losing American jobs , it also significantly helps U.S. businesses. Today, it’s estimated that approximately 300,000 U.S. jobs are outsourced every year, with more than one-fifth of occupations having the potential to be outsourced in the future.

Current data shows that the outsourcing market will continue on an upwards trajectory. Growing at a compound annual growth rate of 4% between now and 2025, the international industry is expected to grow by $40.16 billion by 2025.

Population Reference Bureau. “Offshoring U.S. Labor Increasing.” Accessed on September 26, 2021.

Statista. “Global Outsourcing Market Size 2000-2019.” Accessed on September 27, 2021.

Statista. “Outsourcing Penetration Rate In North America By Country 2019.” Accessed on September 27, 2021.

PR Newswire. “Business Process Outsourcing Market To Grow By USD 40.16 Billion During 2021-2025.” Accessed on September 27, 2021.

Reliable Plant. “68% of U.S. Consumer Products Companies Use Outsourcing.” Accessed on September 30, 2021.

Center for American Progress. “5 Facts About Overseas Outsourcing.” Accessed on September 30, 2021.

Statista. “Global Outsourcing Industry Revenue From 2010 to 2019, By Service Type.” Accessed on September 30, 2021.

Business Insider. “The 5 Best Countries To Outsource To In 2019—Plus, The Top 14 Outsourcing Companies Data Entry Agencies.” Accessed on September 30, 2021.

Outsource Accelerator. “How Outsourcing Can Cut Labor Costs By Up To 70%.” Accessed on September 30, 2021.

PR Newswire. “80% Of Small Businesses Plan To Outsource In 2021, Citing The Ability To Save Time, Grow Their Business And Work With Experts.” Accessed on September 30, 2021.

CNBC. “A Snapshot Of The $1.2 Trillion Freelance Economy In The U.S. In The Age Of COVID-19.” Accessed on September 30, 2021.

Devabit. “The Future Of IT Outsourcing.” Accessed on September 30, 2021.

Clutch. “Small Business Outsourcing Statistics In 2019.” Accessed on September 30, 2021.

Walden University. “Role Of Outsourcing In Stress And Job Satisfaction Of Information Technology Professionals.” Accessed on September 30, 2021.

Invisible Technologies. “Important Outsourcing Trends And Statistics You Need To Know In 2020 (And Beyond).” Accessed on September 30, 2021.

CNBC. “The New Outsourcing Hot Spots: More Developing Nation Firms Tap Workers In U.S., Canada, Europe.” Accessed on September 30, 2021.

U.S. Bureau of Labor Statistics. “Service-Providing Occupations, Offshoring, And The Labor Market.” Accessed on September 30, 2021.

KPMG. “Global IT-BPO Outsourcing Deals Analysis.” Accessed on September 30, 2021.

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Elsie is an experienced writer, reporter, and content creator. As a leader in her field, Elsie is best known for her work as a Reporter for The Southampton Press, but she can also be credited with contributions to Long Island Pulse Magazine and Hamptons Online. She holds a Bachelor of Arts degree in journalism from Stony Brook University and currently resides in Franklin, Tennessee.

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What is outsourcing? Definitions, benefits, challenges, processes, advice

Outsourcing can bring big benefits, but risks and challenges abound when negotiating and managing outsourcing relationships. Here’s what you need to know to ensure your IT outsourcing initiatives s쳮d.

tech workers in data center outsourcing

Outsourcing definition

Outsourcing is a business practice in which services or job functions are hired out to a third party on a contract or ongoing basis. In IT, an outsourcing initiative with a technology provider can involve a range of operations, from the entirety of the IT function to discrete, easily defined components, such as disaster recovery, network services, software development, or QA testing.

Companies may choose to outsource services onshore (within their own country), nearshore (to a neighboring country or one in the same time zone), or offshore (to a more distant country). Nearshore and offshore outsourcing have traditionally been pursued to save costs.

Outsourcing services

Business process outsourcing (BPO) is an overarching term for the outsourcing of a specific business process task, such as payroll. BPO is often divided into two categories: back-office BPO, which includes internal business functions such as billing or purchasing, and front-office BPO, which includes customer-related services such as marketing or tech support.

IT outsourcing is a subset of business process outsourcing, and it falls traditionally into one of two categories: infrastructure outsourcing and application outsourcing. Infrastructure outsourcing can include service desk capabilities, data center outsourcing, network services, managed security operations, or overall infrastructure management. Application outsourcing may include new application development, legacy system maintenance, testing and QA services, and packaged software implementation and management.

Today, however, IT outsourcing can also include relationships with providers of software-, infrastructure-, and platforms-as-a-service. These cloud services are increasingly offered not only by traditional outsourcing providers but by global and niche software vendors or even industrial companies offering technology-enabled services.

For more on the latest trends in outsourcing, see “ 7 hot IT outsourcing trends — and 7 going cold .”

Outsourcing pros and cons

The business case for outsourcing varies by situation, but the benefits and risks of outsourcing often include the following:

IT outsourcing models and pricing

The appropriate model for an IT service is determined by the service provided. Most outsourcing contracts have been billed on a time and materials or fixed price basis. But as outsourcing services have matured to include strategic transformation and innovation initiatives , contractual approaches have evolved to include managed services and outcome-based arrangements.

The most common ways to structure an outsourcing engagement include:

Outsourcing vs. offshoring

The term outsourcing is often used interchangeably — and incorrectly — with offshoring, usually by those in a heated debate. But offshoring is a subset of outsourcing wherein a company outsources services to a third party in a country other than the one in which the client company is based, typically to take advantage of lower labor costs. This subject continues to be charged politically because offshore outsourcing is more likely to result in layoffs.

Outsourcing of jobs

Estimates of jobs displaced or jobs created due to offshoring tend to vary widely due to lack of reliable data. In some cases, global companies set up their own captive offshore IT service centers to reduce costs or access skills. Some roles typically offshored include software development, application support and management, maintenance, testing, help desk/technical support, database development or management, and infrastructure support.

In recent years, IT service providers increased investments in IT delivery centers in the US, according to a report from Everest Group. Offshore outsourcing providers have also increased their hiring of US IT professionals to gird against potential increased restrictions on the H-1B visas they use to bring offshore workers to the US to work on client sites.

Some industry experts point out that increased automation and robotic capabilities may actually eliminate more IT jobs than offshore outsourcing.

Outsourcing risks and challenges

The failure rate of outsourcing relationships remains high, ranging from 40% to 70%. At the heart of the problem is the inherent conflict of interest in any outsourcing arrangement. The client seeks better service, often at lower costs, than it would get doing the work itself. The vendor, however, wants to make a profit. That tension must be managed closely to ensure a successful outcome for both client and vendor. A service level agreement (SLA) is one lever for navigating this conflict — when implemented correctly . An SLA is a contract between an IT services provider and a customer that specifies, usually in measurable terms, what services the vendor will furnish. Service levels are determined at the beginning of any outsourcing relationship and are used to measure and monitor a supplier’s performance.

For more on outsourcing contracts, see “ 11 keys to a successful outsourcing relationship ” and “ 7 tips for managing an IT outsourcing contract .”

Another cause of outsourcing failure is the rush to outsource as a “quick fix” cost-cutting maneuver rather than an investment designed to enhance capabilities, expand globally, increase agility and profitability, or bolster competitive advantage.

Generally speaking, risks increase as the boundaries between client and vendor responsibilities blur and the scope of responsibilities expands. Whatever the type of outsourcing, the relationship will succeed only if both the vendor and the client achieve expected benefits.

See also: “ 9 IT outsourcing mistakes to avoid ” and “ 10 early warning signs of IT outsourcing disaster .”

Types of outsourcing

Many years ago, the multi-billion-dollar megadeal for one vendor hit an all-time high, but wholesale outsourcing proved difficult to manage for many companies. These days, CIOs have embraced the multi-vendor approach , incorporating services from several best-of-breed vendors.

Multisourcing, however, is not without challenges. The customer must have mature governance and vendor management practices in place. In contract negotiations, CIOs need to spell out that vendors must cooperate or else risk losing the job. CIOs need to find qualified staff with financial as well as technical skills to help run a project management office or some other body that can manage the outsourcing portfolio.

The rise of digital transformation has initiated a shift away from siloed IT services. As companies embrace new development methodologies and infrastructure choices, many standalone IT service areas no longer make sense. Some IT service providers seek to become one-stop shops for clients through brokerage services or partnership agreements, offering clients a full spectrum of services from best-in-class providers.

How to select a service provider

Selecting a service provider is a difficult decision, and no one outsourcer will be an exact fit for your needs. Trade-offs will be necessary.

To make an informed decision, articulate what you want from the outsourcing relationship to extract the most important criteria you seek. It’s important to figure this out before soliciting outsourcers, as they will come in with their own ideas of what’s best for your organization, based largely on their own capabilities and strengths.

Some examples of the questions you’ll need to consider include:

  • What’s more important to you: the total amount of savings an outsourcer can provide you or how quickly they can cut your costs?
  • Do you want broad capabilities or expertise in a specific area?
  • Do you want low, fixed costs or more variable price options?

Once you define and prioritize your needs, you’ll be better able to decide what trade-offs are worth making.

Outsourcing advisers

Many organizations bring in a sourcing consultant to help establish requirements and priorities. Third-party expertise can help, but it’s important to research the adviser well. Some consultants may have a vested interested in getting you to pursue outsourcing rather than helping you figure out if outsourcing is a good option for your business. A good adviser can help an inexperienced buyer through the vendor-selection process, aiding them in steps like conducting due diligence, choosing providers to participate in the RFP process, creating a model or scoring system for evaluating responses, and making the final decision.

For more advice, see “ Outsourcing advisors: 6 tips for selecting the right one .”

Negotiating the best outsourcing deal

Balancing the risks and benefits for both parties is the goal of the negotiation process , which can get emotional and even contentious. But smart buyers will take the lead in negotiations , prioritizing issues that are important to them, rather than being led around by the outsourcer.

Creating a timeline and completion date for negotiations will help rein in the process. Without one, discussions could go on forever. But if an issue needs time, don’t be a slave to the date.

Finally, don’t take any steps toward transitioning the work to the outsourcer while in negotiations. An outsourcing contract is never a done deal until you sign on the dotted line, and if you begin moving the work to the outsourcer, you will be handing over more power over the negotiating process to them as well.

Outsourcing’s hidden costs

Depending on what is outsourced and to whom, studies show that an organization will end up spending at least 10% percent above the agreed-upon figure to manage the deal over the long haul. Among the most significant additional expenses associated with outsourcing are:

  • the cost of benchmarking and analysis to determine whether outsourcing is the right choice
  • the cost of investigating and selecting a vendor
  • the cost of transitioning work and knowledge to the outsourcer
  • costs resulting from possible layoffs and their associated HR issues
  • costs of ongoing staffing and management of the outsourcing relationship

It’s important to consider these hidden costs when making a business case for outsourcing.

The outsourcing transition

Vantage Partners once called the outsourcing transition period — during which the provider’s delivery team gets up to speed on your business, existing capabilities and processes, expectations and organizational culture — the “valley of despair.” During this period, the new team is trying to integrate transferred employees and assets, begin the process of driving out costs and inefficiencies, while still keeping the lights on. Throughout this period, which can range from several months to a couple of years, productivity very often takes a nosedive.

The problem is, this is also the time when executives on the client side look most avidly for the deal’s promised gains; business unit heads and line managers wonder why IT service levels aren’t improving; and IT workers wonder what their place is in this new mixed-source environment. The best advice is to anticipate that the transition period will be trying, attempt to manage the business side’s expectations, and set up management plans and governance tools to get the organization over the hump.

Outsourcing governance

A highly collaborative relationship based on effective contract management and trust can add value to an outsourcing relationship. An acrimonious relationship, however, can detract significantly from the value of the arrangement, the positives degraded by the greater need for monitoring and auditing. In that environment, conflicts frequently escalate and projects don’t get done.

Successful outsourcing is about relationships as much as it is actual IT services or transactions. As a result, outsourcing governance is the single most important factor in determining the success of an outsourcing deal. Without it, carefully negotiated and documented rights in an outsourcing contract run the risk of not being enforced, and the relationship that develops may look nothing like what you envisioned.

For more on outsourcing governance, see “ 7 tips for managing an IT outsourcing contract .”

Repatriating IT

Repatriating or backsourcing IT work (bringing an outsourced service back in-house ) when an outsourcing arrangement is not working — either because there was no good business case for it in the first place or because the business environment changed — is always an option. However, it is not always easy to extricate yourself from an outsourcing relationship, and for that reason many clients dissatisfied with outsourcing results renegotiate and reorganize their contracts and relationships rather than attempt to return to the pre-outsourced state. But, in some cases, bringing IT back in house is the best option, and in those cases it must be handled with care .

For more on repatriating IT, see “ How to bring outsourced services back in-house .”

More on outsourcing:

  • 7 hot IT outsourcing trends — and 7 going cold
  • Top 10 IT outsourcing providers
  • 9 outsourcing myths debunked
  • The hidden costs of outsourcing
  • 11 keys to a successful outsourcing relationship
  • 9 IT outsourcing mistakes to avoid
  • 10 early warning signs of IT outsourcing disaster
  • 12 signs your strategic partnership has gone wrong
  • 7 keys to transformational outsourcing success
  • SLA guide: Best practices for service-level agreements
  • 10 dos and don’ts for crafting more effective SLAs
  • How to contract for outsourcing agile development

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Must-Know Outsourcing Statistics for 2024

G. Dautovic Image

Table of contents

In Conclusion

  • Frequently Asked Questions

Outsourcing has been a hot trend since 1989. Over the past three decades, it has become an integral part of business management on a global scale.

That doesn’t mean everyone approves. Opinions vary from highly negative to wildly positive.

However you feel about outsourcing, one thing is certain: The gig economy still has to recover from the economic downturn in the previous years, as do some of the biggest industries in the world.

This is why we think it’s important to dig deeper into the newest data and pull out all the most important outsourcing statistics.

Key Statistics on Outsourcing for 2024 - Editor’s Choice

  • Almost 54% of all companies use third-party support teams to connect with customers.
  • The global outsourcing and shared services market is expected to reach $971.2 billion in 2023.
  • There are 73.3 million freelance workers in the US in 2023.
  • 78% of businesses all over the world feel positive about their outsourcing partners.

About 300,000 jobs get outsourced out of the US each year.

  • The IT outsourcing market revenue is projected to reach $460.10 billion by the end of 2023

The global market spending on outsourcing and shared services will reach $971.2 billion by the end of 2023.

The value of the outsourcing sector has been growing rapidly, and is projected to continue expanding at a 6.5% CAGR rate in the 2023-2027 period. The biggest share of the outsourcing market is still in business process outsourcing, which will reach a global market value of $350 billion by the end of the year.

Statistics like this one make it easy to understand why so many people view outsourcing negatively. Negative sentiments are especially strong when there is a big economic crisis, like the Great Recession of 2008, when 86% of Americans blamed outsourcing for exacerbating the crisis.

More than 93% of organizations are considering or have already adopted cloud services to improve outsourcing.

The move toward cloud technology will help companies of all kinds become more capable and responsive while allowing them to rapidly expand their offerings in existing and new markets.

By the end of 2022, 85% of organizations have already adopted cloud services, and what's more, the data shows that a third of all organizations are willing to accept an increase in operating costs if they get access to the cloud in return.

This means that for a large number of businesses, the main motivation for this move is not to lower costs by cutting jobs , but to be more competitive and increase innovation.

Some 75% companies use external providers to leverage data and analytics. 

In recent years, businesses have increasingly been turning to third-party sources for detailed analytics and insight generation, with more than three quarters of all companies surveyed leveraging this sensitive data through outside partners.

Out of all these organizations, 94% are leveraging service providers to innovate the data by developing AI and machine learning technology, an indicator of the rapidly growing adoption of this cutting-edge tech. 

Data security is a top concern for 68% of outsourcing companies that are considering moving to cloud technology.

As cloud technology continues to disrupt the outsourcing industry, some of the main concerns that companies have are related to information security and compliance with the law.

However, IT outsourcing trends point to an additional concern that has everything to do with performance: 45% of outsourcing businesses worry that a cloud-based service may not be stable or reliable enough. Some 35% of respondents identify a fear of losing intellectual property as their biggest concern.

More than 44% of chief intelligence officers say they are now more likely to use outsourcing suppliers than they were just five years ago.

The latest offshoring data shows that the IT sector is moving toward outsourced suppliers most quickly. In fact, about 64% of outsourced offshore technology functions have to do with software application development.

The same research has shown that 51% of technology executives outsource application and software maintenance, and 40% outsource their data centers.

Saving money is a major motivation for outsourcing IT.

Freeing up resources to focus on core business is the most widely cited reason for outsourcing IT functions, at 49%. Saving money is secondary, but still a top priority. About 45% of companies outsourcing IT functions say that their information technology outsource projects are meant to save money.

About 46% say outsourcing lets them access skillsets that aren’t available in-house.

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71% of financial service executives outsource or offshore some of their services.

Financial companies are among those that outsource the most. About 70% of retail and transportation firms do the same, while pharmaceutical companies currently hold the top spot, with roughly 82% of these organizations outsourcing some of their services.

80% of financial companies and institutions are implementing or considering implementing robotic process automation.

The trend toward automation is accelerating, as outsourcing statistics like this one show. Robotic process automation is often the first step a company can make toward digital labor, and most financial companies are already implementing it.

What’s more, 81% of financial companies are satisfied with their robots, meaning that continued growth is all but guaranteed. This trend is currently most visible in HR and invoice processing sectors, where bots are increasingly replacing people.

The global IT outsourcing market revenue is projected to reach $460.10 billion in 2023.

IT outsourcing is projected to continue growing at a 11.07% CAGR until 2028, and is projected to reach $777.7 billion by that time. Currently, the most revenue in the IT outsourcing market is generated in the US, with $167.90 billion projected by the end of 2023.

More than 654,093 Californians have lost their jobs to China since 2001.

Californian economy has suffered the most in the US when it comes to jobs lost to outsourcing, mainly because of Silicon Valley and the shrinking of the state’s apparel industry.

A quick look at jobs lost by industry illustrates why California, as the home of most US tech giants, suffered so much. Of 3.8 million jobs that the United States has lost to China since 2001 when the country joined the WTO, 2.89 million were in manufacturing. Out of all Californian jobs lost to China, 74% were in the manufacturing sector.

Worldwide, the financial and accounting business processing outsourcing market is expected to reach $60.31 billion in 2023.

The same data shows that this market is expected to grow at a 9.1% CAGR from 2023 to 2030, with order-to-cash segment representing over 50% of the market share. The biggest factor driving this market growth is the increased need for cost-effective services with advanced technologies. 

The global outsourced customer experience market was estimated to be worth $74.16 billion in 2022.

Outsourcing statistics by year demonstrate that customer service is among the most outsourced processes for large companies and financial organizations. Since most businesses believe that improving customer experience is a top priority, it’s not surprising that growth is projected to continue throughout 2024.

The value of the market is projected to increase to $80.7 billion by 2028, growing at a CAGR of 3.42%.

The most commonly outsourced jobs in small businesses are accounting and IT.

Small businesses usually turn to outsourcing when it comes to accounting and IT because those tasks require proficiency and skills that they might not possess internally. That’s why the data shows that 37% of all accounting and IT tasks get outsourced. Digital marketing tasks follow at 34%, with development and human resources at 28%.  However, a report from Gartner in 2022 showed that some 60% of finance and accounting outsource contracts are not expected to be renewed by 2025.

27% of small businesses outsourced to improve efficiency and save time in 2022.

Small business owners care about efficiency above all. Compared to larger companies, these businesses usually cannot afford or simply do not have access to the necessary resources to build a team from scratch. The same survey found that 35% of small businesses outsource to access flexible resources, whilw 26% of small businesses with 10 or fewer employees outsource with the goal of working with an expert.

29% of businesses with fewer than 50 employees outsource, compared to 66% with 50 or more employees.

Smaller businesses are less inclined to spend money on outsourcing when compared to global outsourcing companies, as they usually feel like it is better to keep the money inside their firm and do things themselves. When they do outsource, smaller companies tend to turn to freelance workers.

83% of small businesses plan to maintain on increase their spending on outsourced services in 2023.

Most small businesses state that the main reason they wish to increase spending on outsourcing has to do with the ability to manage the scaling up or down quickly, as well as supplementing their current teams or filling in the skill gaps, along with the fact that hiring outside usually costs less than hiring in-house.

76% of executives in the business and technology sectors say that their companies outsourced IT services.

Out of this number, the biggest share of outsourced IT work comes in the form of cybersecurity (81%), followed by app and software development (79%) and IT infrastructure services (77%). 

deloitte business outsourcing info

Small businesses spent an average of $198,550 on outsourced service providers in 2022.

With the growing demand and shift to outsourced specialist and specialized agencies, this number is expected to grow even more in the coming years.

57% of companies in 2022 used traditional outsourcing because of the overall need to cut operational costs.

The same research found that the second most-quoted reason were shifts in business strategies and operating models, with 51% of responders claiming this is why they increasingly rely on outsourced work, while 49% claimed that the biggest reason was to gain access to new capabilities.

The US administration is focused on bringing manufacturing and other outsourced industries back to American soil, but overall, global trade policies remain in constant flux. Tariffs, quotas, and geopolitical factors are sure to keep outsourcing on the radar for many years to come.

The outsourcing statistics we’ve gathered also show an obvious split between small businesses and large corporations as emerging technologies like artifical intelligence and robotic automation change the market even further.

While outsourcing is likely to continue growing, the functions that are outsourced and the companies that rely on outsourcing may change. Operations are generally moving in-house, while key sectors like software development and maintenance remain outsourced.

What is the success rate of outsourcing?

The data from 2023 has shown that an overwhelming majority, or 78% of all businesses have a successfull and positive experience with outsourcing.

Which country outsources the most?

The United States is easily the biggest country in terms out outsourcing, with 68% of all large companies using outsourcing services, followed by the United Kingdom at 48%.

Which industry outsource the most?

The IT industry outsources the most, and represents 54% of the total outsourcing market share worldwide.

G. Dautovic

I have always thought of myself as a writer, but I began my career as a data operator with a large fintech firm. This position proved invaluable for learning how banks and other financial institutions operate. Daily correspondence with banking experts gave me insight into the systems and policies that power the economy. When I got the chance to translate my experience into words, I gladly joined the smart, enthusiastic Fortunly team.

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Outsourcing Statistics 2024: In the US and Globally

Top outsourcing statistics : editor’s choice, statistics on outsourcing rundown, us outsourcing statistics, frequently asked questions.

Running a business can be expensive. Is there a more efficient way to reduce that cost than moving some of the work to people from other, cheaper parts of the world? Probably not.

The outsourcing statistics listed below will point out the good and the bad sides of this business, as we answer some of the key questions on the topic. By the way, outsourcing doesn’t always need to be financially motivated. The lack of expertise is just one of the other factors prompting companies to seek external professionals locally, nationally, or internationally. Read on to find out more.

  • The global outsourcing market was worth $92.5 billion in 2019.
  • 59% of companies outsource to cut costs.
  • Outsourcing accounts for 10% of the Philippines’ economy.
  • 37% of small businesses outsource at least part of their business process.
  • 80% of companies aren’t planning on outsourcing any sales or marketing jobs.
  • 14.3 million jobs are outsourced from the US.

1. 59% of companies outsource to cut costs.

Cost-cutting is the most common reason that makes organizations turn to outsourcing. More than half of businesses take this step in a bid to reduce the weight on their budgets. Other reasons include:

  • Enabling focus on core business (57%);
  • Solving capacity issues (47%);
  • Improving service quality (31%);
  • Meeting business needs (28%).

2. The global outsourcing market was worth $92.5 billion in 2019.

Outsourcing statistics by year show that in 2019, the value of global outsourcing services reached $92.5 billion. Compared to 2018, the market grew by just over 8%. Still, the value of outsourcing services provided around the world remains far from the 2014 record of $104.6 billion.

3. India is the top global outsourcing destination.

Outsourcing statistics by country put India on top of the list of global outsourcing providers, with much of the industry being concentrated in the cities of Bangalore, Mumbai, and Delhi. The global top 5 of BPO destinations is rounded up by China, Malaysia, Indonesia, and Brazil.

4. Outsourcing accounts for 10% of the Philippines’ economy.

Offshoring customer service is standard practice for thousands of businesses around the world. Stats on outsourcing show India has always been the leading market for call centers.

For the past five years, however, the Philippines has been strengthening its foothold in the game, as outsourcing has become one of the major contributors to this country’s economy. According to estimates, the country’s BPO industry employs over 1.2 million people.

5. 37% of small businesses outsource at least part of their business processes.

Over a third of small businesses use outsourcing, according to a 2019 study by Clutch. 52% of participants in the outsourcing survey plan on contracting out a business process in the near future. The small business outsourcing statistics are based on the answers of 529 market players.

6. 37% of businesses that outsource list accounting as one of their outsourced processes.

Accounting is the most commonly outsourced business aspect, at least among small businesses. The top 5 list also includes IT services (37%), digital marketing (34%), development (28%), and HR (24%).

7. 65% of companies that outsourced in the past are planning to increase outsourcing.

Outsourcing statistics by industry show that the majority of organizations—especially those in the manufacturing and IT business—plan on increasing their outsourcing efforts. Once they experience the financial benefits of this practice, just 35% of companies don’t plan to expand on it.

8. Ukraine has over 200,000 IT workers.

Ukraine boasts the fastest-growing number of IT professionals in Central and Eastern Europe. IT outsourcing statistics put the number of those workers in the country at over 200,000, potentially turning Ukraine into the next big market for the IT outsourcing industry .

9. 80% of companies aren’t planning on outsourcing any sales or marketing jobs.

There are some positions that organizations tend to avoid outsourcing. Sales and marketing are two of them. Strategic planning is also among the activities that 89% of businesses would not consider entrusting to external vendors.

10. Over 1 million outsourced jobs are in danger due to automation.

All previous job outsourcing statistics could be overshadowed by a new development in the industry: repetitive and/or low-skilled jobs that have been outsourced are now at risk due to automation. Estimates show that, in the next five years, automation could ax some 1 million jobs in the US, Poland, India, and the Philippines.

11. The global HR outsourcing market is expected to grow at a CAGR of 8.69% until 2022.

Despite the previous stat, HR outsourcing statistics are showing no signs of slowing down. Since 2018, the industry has been expanding steadily at a compound annual growth rate of 8.69%. The trend is expected to continue at least until 2022.

12. 93% of companies have adopted cloud services to optimize outsourcing.

In order to streamline their outsourcing efforts, 93% of organizations have either adopted or are considering adopting cloud-based solutions. These solutions might help with control and coordination, but they come with some risks, particularly when it comes to protecting sensitive data. This is why 68% of these organizations cite security as their primary concern.

13. More than 84% of outsourcing deals come from the US.

The US is responsible for the lion’s share of outsourcing deals. The country alone accounts for 84.2% of the $92.5 billion spent on BPO services globally. On a regional level, North and South America attract 42% of overseas outsourcing buyers.

Europe, the Middle East, and Africa together account for 35% of deals in the industry, while Asia and Oceania hold a 23% share.

14. Every year, US businesses outsource about 300,000 jobs.

These offshore outsourcing statistics give a clear indication of the scale of BPO. In 2015 alone, US foreign affiliates hired 14.3 million workers overseas. If those outsourced jobs stayed in the US, they would be enough to hire the 5.9 unemployed Americans, plus 4.3 million of those who are working part-time and want to switch to a full-time position.

15. 29% of US businesses with less than 50 workers outsource.

Outsourcing in the USA is much less common among businesses that have 50 or fewer employees. Just 29% of them outsource. Companies that employ more than 50 workers, on the other hand, are much keener to take some of their work outside: outsourcing statistics show that 66% of them do so.

16. 71% of Americans think that outsourcing harms the US economy.

While organizations across the world enjoy the benefits of outsourcing, most members of the US population agree that it is harming the economy. 71% of Americans think that outsourcing has a negative impact, and 62% want the government to ban it altogether.

17. California has lost 654,000 jobs to China since 2001.

Jobs lost to outsourcing statistics show that, between 2001 and 2018, California lost 654,000 jobs to China. Texas is next on the list with 335,000 displaced jobs, followed by New York with 185,100 lost workplaces. Directly or indirectly, China is responsible for the loss of 3.7 million jobs in the US.

What is global outsourcing?

Global outsourcing is a business practice where a company decides to task a third party with dealing with some of its services or job functions. Companies can decide to outsource a small part of their operations (for example, QA testing), or their entire divisions (for example, IT).

Depending on where it takes place, outsourcing can be onshore (within the country), nearshore (to a nearby country), or offshore (to a remote country).

How big is the outsourcing industry?

The outsourcing market saw $92.5 billion worth of services during 2019, growing at a significant annual rate of 8%. However, the outsourcing industry reached its peak in 2014, when the world spent a total of $104.6 billion on BPO services.

What are the advantages of outsourcing?

Companies that outsource do so mainly as a cost-cutting effort. Around 59% of businesses that outsource say saving money is one of the reasons behind their decision. Reducing spendings on labor, operation, and overhead is, arguably, the biggest benefit of BPO. Other advantages include improved efficiency, freeing up internal resources, and mitigating risks by sharing difficult tasks.

What are the negative effects of outsourcing?

International outsourcing doesn’t come without risks and negative sides. The danger of losing sensitive data is always there when you work with third parties. Lack of quality control is also a common fear shared by businesses that outsource. 

What are the most outsourced jobs?

Accounting-related and IT jobs are the most outsourced ones, with 37% of businesses that outsource listing them as one of the operations that they contract out. Digital marketing jobs are outsourced by 34% of these businesses, followed by development-related activities (28%), and HR (24%). The list of jobs that can be outsourced is virtually endless.

Which countries outsource the most?

Outsourcing research shows that India, China, and Malaysia are the biggest outsourcing destinations in the world. The country that outsources the most is the US, where more than 84% of all BPO deals are made. The UK is at the other end, accounting for around 5% of the deals.

How many US jobs have been outsourced?

In order to find the appropriate workforce or cut costs, US businesses have outsourced 14.3 million jobs. If these jobs had stayed within the country, they would have been more than enough to cover local unemployment: there are currently 5.9 million jobless people in America, as well as 4.3 million part-time workers who want to transition into full-time work.

How many jobs are outsourced to India?

As mentioned above, India is the largest market for businesses looking to outsource. Even though the exact number of BPO jobs in India is not available, we can expect it to keep growing, as the cost of local labor remains far lower than the average global standards.

Outsourcing is an excellent way to reduce the costs of running a business. It is also a smart lever to improve efficiency by freeing up internal resources and mitigating risk. However, it does come with some negative sides. Should you outsource or you should rather count on your own staff to deal with all or some of your non-core operations? The decision is up to you. Take your time to carefully tick all the pros and cons. Consult the experts, do your numbers, and feel free to use our list of outsourcing statistics as a guide.

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Remote work could be the reason you don’t have a job in 10 years

Woman working on porch

Workers who have been rejoicing about their ability to log on from anywhere might do well to consider the inverse situation: a worker somewhere else can probably do their job—for cheaper. 

That might cost them their job in the long run. 

The fact that many jobs that can be done from home can also be done from anywhere around the globe is often missing in the remote work discussion , says Anna Stansbury , an assistant professor of work and organization studies at MIT Sloan School of Management who teaches a course on the future of work. 

Companies haven’t yet internationally outsourced many jobs that require higher education, Stansbury tells Fortune , adding that many call center-type jobs, or remote-first jobs like software design or back-end engineering have already been offshored.

But if high-paying white collar jobs can be done remotely, outsourcing them to cheaper areas could “pretty clearly” offer huge savings. The potential for change “would be seismic if all of these well-paid white collar jobs were suddenly outsourced to less rich countries,” she adds. 

“If people that code for Google and Facebook were able to live wherever in the U.S. they wanted and [work] for a year and a half without ever going to the office, it seems very, very likely that a lot of companies will be rethinking this longer-term and outsourcing those kinds of jobs that didn’t used to be outsourced,” Stansbury adds. 

Be afraid, be very afraid

Stansbury’s not the only person ringing alarm bells on remote work.  Experts have said outsourcing remote jobs is a real possibility, one that could fill in the gap of a tight labor market but one that could also not bode well for workers during a recession.

Stansbury cites the research of Richard Baldwin, an economics professor at the Graduate Institute in Geneva, Switzerland. “If you can do your job from home, be scared. Be very scared,” Baldwin said in November . “Because somebody in India or wherever is willing to do it for much less.”

That fear has been well-documented for over a decade, according to an October 2021 National Bureau of Economic Research (NBER) paper by Baldwin and his research partner Jonathan Dingel. In the paper, titled “Telemigration and Development: On the Offshorability of Teleworkable Jobs,” they categorize jobs into one of four groups: highly offshoreable, offshoreable, hard to offshore, and non-offshoreable. 

Landing in the “highly offshoreable” category requires “no” answers to just two questions: “Does a person in this occupation need to be physically close to a specific US work location?” and, if not, “Must they be physically close to a work unit?” 

In the post-Covid workplace , tasks that can be done remotely will inevitably be done by telemigrants rather than domestic workers, Baldwin and Dingel predict. 

To be sure, such a shift is easier said than done. “Social and cultural contexts across countries [make] it less likely that a public relations specialist or a sales engineer located in Hanoi is a perfect substitute for one located in Seattle,” they add.

According to the Washington Post’s analysis of Labor Department data on remote work during the pandemic, “the more a job pays, the easier it is to do remotely,” and the highest-paying industries—like software and internet publishing—have the most remote workers. The lowest-paying jobs, in sectors like retail and food service, are also the least likely to go remote.

In other words, knowledge workers who have greatly enjoyed the chance to work from anywhere may need to prepare for the possibility that their good luck could dry up.

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Outsourcing in 2022

  • March 24, 2022
  • No Comments

Outsourcing In 2022

Outsourcing has shifted from a low-cost overseas solution to one that offers numerous options. Recent developments in the pandemic have caused many businesses to transition to hiring workers off-site. Do these practices remain the same? How will the climate of 2022 change the outsourcing model? 

In this article, we will delve into the trends that outsourcing has to offer this 2022. 

Trends in 2022

With the onset of the pandemic came the rapid transition from on-site employment to off-site or work-from-home setups. This also gave rise to many businesses choosing to hire their employees off-shore for lower costs and to keep up with the changes that the pandemic has brought forth. 

Consequently, outsourcing has also grown more rapidly causing massive changes in its trends this year. 

Remote and Off-Shore Work Setup 

How we work has changed dramatically. The pandemic has forced businesses to cut costs, restructure, and rapidly pivot to remote working. This setup is seen to be a continuing trend this year as businesses realize the benefits of working remotely.

Moreover, a lot of business owners have opted to hire off-shore work since a lot of top talents are based off-shore and they can also cut costs for employment which is where the outsourcing firms come in to help. 

As a result, it has also caused the outsourcing industry to boom since it allows businesses to find the best candidates without going through the tedious process of posting and going through the whole hiring and training procedure as if they were hiring internally.

Talent Diversity and Niche Specificity

As we have already touched off-shore talents and the comforts of utilizing help from an outsourcing team, I also want to touch upon the talent diversity specific to the niche that the business wants to offer that hiring these outsourcing firms can help business owners with. 

Modern companies undertaking future-oriented projects are having trouble hiring people with the skills they need. Network programmers for example, and security specialists working on digital marketing facets like PPC, are examples of specific skills that companies have trouble finding.

This is why a lot of companies nowadays seek out the help of firms such as Synergy Advantage to find the best experts. 

Flexible Working Schedule 

Organizations across the globe have adapted to new ways of operating as a result of advancements in communication technology and an increasing number of remote workers. 

As opposed to having employees stick to a strict schedule, managers are being pressured to give their employees the option to work remotely to free up time. It gives employees greater control over their schedules and allows them to choose when to start working instead of being forced to work at a certain time. 

When an employer notices higher employee satisfaction because of this newfound freedom, they benefit from reduced turnover, reduced hiring costs (and maintenance costs) from not hiring new workers on an infrequent basis, and improved productivity through happier workers who are less likely to raise issues over not being able to resolve them on their terms.

Exploring More Advanced Tools 

Organizations have a variety of tools at their disposal but technology is constantly evolving causing companies to rethink the tools they use. 

Many businesses are placing high emphasis on how to move forward by adding more specialized technology and implementing it to help better facilitate collaboration and data management, while also giving better advantage when compared to their competitors who aren’t currently preparing for what’s coming next.

 Hiring an outsourcing firm is the best option especially for start-ups this year to gain access to such tools and expertise since more and more of these firms offer such packages. 

Cybersecurity Threats

In 2022, businesses will have become more complicated with new security threats and vulnerabilities emerging almost daily.

 As technology has improved, the risks to both our information and privacy have risen too, which is why businesses of all sizes must invest in a variety of methods for protecting their data from cyberattacks, spam, and viruses.

The advantage of outsourcing is that it allows companies to focus on their core product or service while still adding specific and in-demand skills based on the objectives of their business.

In the scenario of an online bank, for example, want to focus on customer satisfaction rather than investing in a large IT department, outsourcing might be a smart move since it would allow you to manage your contacts and even delight your customers with extra services. 

To improve security measures offered by businesses, they need intelligent and fast data-driven solutions. 

Security is key but businesses need more than just that! They need control over their resources together with the proper support given by the team they chose as an outsourcing partner.

Outsource in 2022

Several years ago, outsourcing was primarily used to handle non-core tasks to save money; today, companies outsource even core tasks to improve efficiency. 

Outsourcing trends are constantly changing, and sometimes these changes are so disruptive that an outsourced business may lose the edge if it doesn’t have a reliable outsourcing partner who is up to date with the latest trends. 

Therefore, outsourcing firms should be entering an industry that constantly thrives on new technologies and changing market conditions.

And, this is where experts from Synergy Advantage come into play. Know Your Advantage and improve your business’ gameplay this 2022 NOW! Call us at 1-855-534-6273!

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  • Boeing & Aerospace

Boeing will outsource more corporate jobs to India

Dominic Gates

Boeing told nonunion corporate staff in an all-hands virtual meeting this month that it will begin outsourcing finance and accounting jobs to Tata Consultancy Services of India.

Boeing said Tuesday that about 150 jobs nationwide will be cut in the first batch of layoffs, with more to come next year and thereafter. The first layoff notices will go out in October.

“The Finance team is planning for lower staffing levels as it simplifies processes, improves efficiency and shares select work with an outside partner,” Boeing said in a statement, adding that it “will assess future impacts as the process continues in the coming years.”

“It was kind of a shock the way they rolled it out,” said one senior Boeing finance employee, who asked for anonymity to retain his job. “They had the all-hands enterprise meeting and then four days later everyone was moved into new organizations with new managers.”

Boeing’s finance group pre-pandemic consisted of about 6,000 employees companywide, according to the company. At least 1,000 are in the Puget Sound region, the finance employee said.

The announcement has left many people hanging, wondering if their jobs will be among those cut but not knowing for sure.

“We’re trying to strike a balance, being as transparent as we can without getting ahead of the work that we still have to do,” a Boeing spokesman said. “We’ve been frank with employees that we do expect lower staffing levels within finance. As soon as we know the details, we’ll share those.”

This week, Tata managers began directly consulting with Boeing finance and accounting managers to identify the precise work statement the Indian company will take over. Once that’s pinned down, Boeing will notify the individuals who are to be laid off, including some management employees.

Before their departure, those employees will be asked to train the Tata personnel in Boeing procedures to smooth the handover of the work.

Transformation = downsizing

The planned layoffs are part of a broad and concerted Boeing effort in recent years to cut nonunion corporate jobs.

“Several of our corporate functions, including Information Technology and Finance, have implemented changes to streamline their operations, resulting in lower staffing levels” in those areas, Boeing said Tuesday.

That push began with moves to get rid of IT work that could be done more cheaply elsewhere and was not seen as central to Boeing’s business.

In 2013, Boeing began cutting 1,500 IT positions in the Puget Sound region. Last year, it outsourced to Dell another batch of IT work, eliminating 600 jobs across the company .

Several years ago Boeing outsourced a range of low-level finance work to Genpact, a multinational company founded in India and with a large presence in that country.

According to the senior Boeing finance employee, Tata will take over some of the Genpact work, though Genpact will continue to do some other work for Boeing.

Boeing’s new Chief Financial Officer Brian West, who joined the company in August last year, has intensified the focus on cutting financial and accounting jobs.

In November, he appointed Amy Rodrigues to lead the finance and accounting team, with a telling extension to her title: vice president of finance and finance transformation.

Boeing corporate refers to the transformation as streamlining. To the affected employees, it’s simply downsizing.

The downsizing comes as Boeing is scrambling in a tight labor market to hire mechanics to build planes and engineers to design them after a severe round of front-line job cuts during the global pandemic.

Boeing cut just over 20,000 jobs in 2020 companywide — 15,000 of those in Washington state — as the pandemic hit its commercial airplane business hard.

Last year, it cut a further 1,000 jobs in Washington state .

This year, as air travel demand returned and Boeing started to ramp up 737 MAX production in Renton and poured engineering resources into fixing the problems on the 787 and various defense projects, the company finally began rehiring and adding back jobs, mostly in engineering and manufacturing.

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Taking the sting out of the relatively small number of white-collar layoffs ahead in finance, Boeing said Tuesday it has “significantly increased hiring in engineering and manufacturing as market demand increases and we drive stability in production and invest in engineering and innovation.”

“Overall, we have expanded the Boeing workforce by about 10,000 employees this year,” Boeing said.

That still leaves Boeing down about 10,000 jobs relative to the workforce it had pre-pandemic.

Boeing in India

Boeing now has about 3,500 direct employees in India.

The Boeing India Engineering & Technology Center in Bengaluru and Chennai undertakes complex advanced aerospace engineering work. Boeing has invested more than $200 million in the Bengalaru campus, its largest investment outside the United States.

The company has plans to develop an avionics manufacturing and assembly facility there — replacing an in-house capability that Boeing abandoned in 2003 and has been attempting to recreate since 2017 .

Facing a shortage of engineers in the United States, and with its major engineering center in Moscow closed since the Russian invasion of Ukraine, Boeing sees India as a key supplier of engineering talent.

Another 7,000 people in India are employed at Boeing’s suppliers, including the multinational conglomerate Tata Group, headquartered in Mumbai.

Boeing this year named Tata Aerospace & Defense, India’s largest private aerospace manufacturer, a “2022 Supplier of the Year.”

That Tata division makes aircraft landing gear doors, vertical fins, floor beams, underwing and overwing panels, fuselages, secondary structures, and tail cones. A joint venture with Tata Group also produces AH-64 Apache helicopter fuselages in Hyderabad for military customers around the globe.

Tata Consultancy Services, the Tata Group subsidiary taking over the Boeing finance jobs, is a major IT and financial services consulting company with about 600,000 employees worldwide. Its market capitalization stands at $140 billion, 60% larger than Boeing’s.

Editor’s note: An earlier version of this story misstated the number of employees at Tata Consultancy Services. It has about 600,000 employees worldwide.

The opinions expressed in reader comments are those of the author only and do not reflect the opinions of The Seattle Times.

Scamming the boss: Some employees are outsourcing their jobs to other people. Here's how companies are spotting the fraudsters.

  • As remote work provides opportunities for fraud, some employees are outsourcing their jobs.
  • Staffing executives say the practice is more common in IT, coding, and developer roles.
  • Experts say this fraud poses risks, particularly when the work involves confidential company data.

Insider Today

It didn't take long for Khuram Raza Zakhaif, an independent cloud-computing consultant in Lahore, Pakistan, to realize something was fishy.

A German employee at a large chipmaker contacted him through the freelancer site Upwork because he needed help on some connectivity issues he was dealing with. The two signed a nondisclosure agreement and arranged a video call.

Then things got weird. When Zakhaif asked the employee basic questions about the chipmaker's system configurations, the employee forwarded him recordings from internal team meetings and his personal login credentials and passwords.

Zakhaif was wary. "I told him, 'You could get in trouble if you let me use your identity to impersonate you,'" he said. The employee said it wasn't a big deal, and he'd pay Zakhaif to do the job.

Zakhaif balked. "Then he became argumentative — he said in Germany it's common to outsource your job, he's done it multiple times, and all his colleagues do it, too," Zakhaif said. "I told him, 'Dude, I'm out.'"

When Zakhaif posted about the experience on Reddit , other freelancers messaged him with similar stories. "I guess it is more common than I realized," he said.

Even before the pandemic ushered in the Zoom era, remote work offered opportunities for employees to deceive their employers by working fewer hours than they were contracted to or working for multiple organizations at once. Today, the rise of remote hiring and work combined with an acute labor shortage has provided an opportunity for fraudsters to outsource their jobs to other people.

Research suggests that employee and job-candidate fraud — for instance, people impersonating prospective workers or getting others to take their cognitive or coding tests for them in order to get hired — has risen recently, though it's difficult to monitor. Data on the incidence of people outsourcing their jobs is hard to come by, but anecdotal evidence from company executives suggests the practice is on the rise.

Experts say this fraud can pose severe risks for companies, especially when the work involves confidential company and customer data. Some observers say the fact that some rogue employees are doing this could signify an even bigger problem: Nearly 2 1/2 years into the remote-work revolution, employers do not have a good handle on managing their remote workforces. 

Subtle signs the work is being outsourced

Outsourcing isn't uncommon in fields such as investment banking and consultancy, but it's done with the knowledge and financial support of employers. The problem for companies is when employees outsource their jobs without their organization's awareness, and pay out of their own pockets.

The phenomenon is not new. In 2013, Verizon's security team said it found that an American programmer who had outsourced his job to workers in China and watched cat videos at the office all day — a story that briefly set the internet ablaze .

Cameron Edwards, the senior vice president of client strategy and operations at the staffing agency Matlen Silver, a staffing agency, screens applicants for full-time jobs at Fortune 500 companies. She said that the practice is most common in technical, IT, coding, and developer roles and that the employees pulling these kinds of scams are often people authorized to work in the US and western Europe and therefore earn a relatively high salary. They get hired at large companies as full-time in-house technology consultants and then outsource their jobs or aspects of them to workers in lower-cost countries and pay them accordingly.

 She said that before the pandemic she occasionally became aware of employees working two or more 40-hour-a-week contracts from different companies, sometimes competitors — but that the frequency has risen in the past couple of years.

"As the world has evolved to become more hybrid and remote, it's just that much easier to pull off," she said, adding that recently several clients have told her about newly hired employees who were outsourcing their jobs to others. "Nothing surprises me anymore."

Edwards said that from the employer's perspective, there are a few signs that outsourcing might be taking place — for instance, the work takes excessive time to complete, or it's done at odd hours, or the employee offers excuses for why they can't hop on the phone or be on camera.

There are other suspicious signs: A company's IT department might flag that an employee has forwarded work to a personal email, or it could discover through IP activity that the employee's credentials are being used to access the company's computer systems from afar.

"Managers are looking for signs more and more," she said. "Honestly, I think it's why you hear so many executives saying that we have to get back to the office. It's challenging to monitor this in a remote environment, and they're tired of being burned."

A nefarious side hustle

Many American workers have a side gig or entrepreneurial venture. Employers are generally powerless to do anything about these second jobs as long as they don't affect their employees' work and don't involve work for a competitor. 

But Josh Bersin, an HR-industry analyst, says that employees generally aren't allowed to subcontract any part of their regular 9-5 jobs and that the practice is a fireable offense. "Every employer I talk to considers 'remote' as a location — not a work arrangement," he said, meaning remote workers must abide by the company's rules.

All this raises some questions: Why are people doing this? And why do they think they can get away with it?

The fraudsters are not forthcoming, but industry insiders have a few theories.

Vik Kalra, a cofounder of Mindlance, a staffing firm focused on placing highly skilled contractors at Fortune 1000 companies, said he's twice seen cases where an employee hired to do the job was not the person doing it.

He speculated that the employees were underqualified for their roles and the only way they could fake it was by getting help from an outsider, or they wanted to make more money by working multiple jobs at once.

Kalra said the scammers he's heard about probably didn't worry too much about getting caught, because even if they were let go, the tight labor market means it's relatively easy to get another job as a coder or developer. "But for now, the only disincentive is that they get fired from a consulting job. That's not enough."

Stopping security risks

Experts say that job outsourcing can make organizations more vulnerable to security breaches.

Lou Shipley, a former CEO of Black Duck, an open-source security company, and a senior lecturer at Harvard Business School, said the practice creates more opportunities for bad actors to infiltrate a company's proprietary systems and makes companies more vulnerable to broader attacks and theft of company data.

The research-and-consulting firm  Gartner has suggested that the "ever-expanding digital footprint of modern organizations" is one of the top cybersecurity trends of 2022. It said large numbers of remote workers combined with greater use of public cloud and highly connected supply chains "have exposed new and challenging attack 'surfaces'" within companies.

Shipley said purposeful or accidental data leakage, where information is leaked by someone who hasn't been trained, is one possible problem. The company is also more susceptible to intellectual-property theft.

Mitigating the risk isn't easy, but experts say there are a few things companies can do. For starters, they should issue secure work devices, which ought to come with antivirus software and automatic updates and include tracking software that can ensure files in the company intranet or the work produced by employees are not shared outside the organization.

"Computer infrastructure needs to be centrally managed and controlled by the company," said Michael Corby, a former chief information officer who now consults with companies on information-security and privacy risks.

Organizations should also make sure all employees communicate communicate through encrypted channels, typically by using a virtual private network, or VPN, to help preserve data integrity and security. Along those lines, all employee correspondence should include a digital signature, which can validate the sending and receiving parties.

Crucially, Corby said, organizations need to remain vigilant about keeping their data secure and private, usually by IT and risk management. "There needs to be someone accountable for operations integrity," he said. "Otherwise you don't know what you don't know."

Kalra went even further: He said the growing incidence of job outsourcing is an indication that many employers have yet to figure out how to effectively manage their remote workforces. He said there needs to be more training on technology protocols and data privacy and a greater focus on developing the skills necessary to govern remote and hybrid workers.

"As it stands, remote work at a lot of organizations is seen as an individual right, but it needs to be seen as a privilege with a lot of restrictions," he said. "The whole system is built on trust, but it's not sustainable."

outsourcing jobs 2022

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Outsourcing Jobs in AP 2022: All the  Latest APCOS Recruitment Notifications 2022 to apply for 10000+ vacancies in Andhra Pradesh. The list contains new jobs announced by various district wise Andhra Pradesh medical and health departments. Ap govt has decided to increase the vacancy in General hospital posts

DCHS & DMHO AP Notifications 2022 -> -> ->

Here we have shared the ocean of opportunities for outsourcing employees in Andhra Pradesh which are going to be released by APCOS. Andhra Pradesh Corporation for Outsourced Services ( APCOS ) is formed for providing the required outsourced manpower to all the offices/government departments / instrumentalists.

AP Corporation for Outsourced Services is going to release APCOS Notification soon to fill various outsourcing jobs. These vacancies are going to be filled in Secretariat Departments, Heads of the Departments, District Administration, Organizations of the Govt. of India, and Corporations, Societies, Institutions, etc. of GoAP. Soon, after the release of AP Outsourcing Recruitment Notification 2022, the authorities will activate the registration link on its official portal i.e, apcos.ap.gov.in.

Candidates who are looking for AP Out Sourcing jobs have to check the latest notifications here. We designed this page to provide the All outsourcing jobs under one roof. Our main motto is providing the latest updates and complete info regarding APCOP Jobs Notifications within seconds. A detailed notification PDF and its apply link will be visible here, once an advt out.

Candidates who have met the eligibility requirements can apply for Andhra Pradesh Corporation for Outsourced Services before the due date. Other details regarding APCOS Outsourcing Jobs Notification 2022 like eligibility, selection process, salary, registration process, apply online link, etc are shared below.  Go through the complete article for much more required details. 

Departments in APCOS

  • Secretariat Departments
  •  Heads of the Departments
  •  District Administration
  •  Organizations of the Govt. of India
  •  Corporations, Societies, Institutions etc

What are the AP Outsourcing Jobs?

Here, we list out the posts that are going to fill in AP outsourcing.

Category 1 Posts:

  • Senior Assistant
  • Senior Accountant
  • Data Processing Officer
  • Senior Steno
  • Support Staff

Category 2 Posts:

  • Data Processing Assistant
  • Storekeeper
  • Photographer
  • Data Entry Operator
  • Cinema/Film/Audiovisual Operator
  • Electrician
  • Telephone Operator
  • Lab Assistant
  • Junior Assistant
  • Junior Steno

Category 3 Posts:

  • Office Subordinate
  • Lift Operator
  • Roneo/Xerox Operator
  • Record Assistant
  • Shroff/Cashier
  • Lab Attendant
  • Cycle Orderly

Note: 50% of the alotted posts are reserved for reserved (SC: 15%, ST: 06%, BC/Minorities: 29%) candidates. For female candidates, 50% of the posts are available in their reservation quota.

Eligibility For APCOS Outsourcing Recruitment 2022

Ap outsourcing jobs age limit.

  • As per the organization norms
  • The lower age limit will be 18 years and the upper age limit will be varied based on the post category
  • Age relaxation is applicable to the reserved candidates as per the AP govt rules

What is the educational qualification for Outsourcing Jobs In Ap?

  • The educational qualifications will vary depending upon the job profile
  • The AP outsourcing jobs are available for 4th pass/5th pass /10th/ITI/Diploma/Engineering/Degree/PG degree
  • For Category 1 posts: Post Graduates are preferred
  • Category 2 posts: Degree/Diploma/ITI/Intermediate qualified candidates are eligible. Computer Knowledge is essential for some posts
  • For Category 3 posts: 10th pass
  • Staff Nurse: GNM Course or B.Sc (Nursing) from a recognised university.
  • Lab Technician Grade-II: B. Sc degree with Medical Lab Technician as one subject/1-year lab technician course after Intermediate
  • Pharmacist Grade-II: B. Pharmacy/ 2 years diploma in pharmacy

Selection Process For AP Outsourcing Vacancy

The selection of the candidates for AP Outsourcing Recruitment 2022 will be based on the interview and document verification

AP Outsourcing Jobs Salary

Selected candidates for Andhra Pradesh Outsourcing Jobs will receive a good salary package as per the organization norms

  • Category 1 posts: Rs. 17500/-
  • For Category 2 posts: Rs. 15000/-
  • For Category 3 posts: Rs. 12000/-
  • Staff Nurse - Rs. 34000/-
  • Lab Technician Grade-II - Rs. 28,000/-
  • Pharmacist Grade-II - Rs. 28,000/-

AP Outsourcing Jobs Registration 2022

After the release of official notification, the AP Outsourcing Recruitment 2022 Application form is available on its official portal. The step by step process of filling the APCOS Online Application Form 2022 are as follows. Candidates have to register for APCOS before going to apply for any job in it. After the successful completion of registration, you can proceed to fill any job application form. 

What are the documents required for APCOS Registration?

  • Aadhar card number
  • Caste Certificate
  • 10th Marks memo
  • Inter marks memos
  • Degree marks list or Graduation certificate
  • Post Graduation certificate or Masters Certification

AP Outsourcing Jobs Registration Apply Online Steps

  • Visit the APCOS official portal i.e, apcos.ap.gov.in or apcos.apcfss.in
  • On the home page, hit the “Candidate’s Registration” link
  • Enter the registration number in the specified column
  • OTP will be sent to the registered email ID and mobile number of the applicant which is attached to the Aadhar card number
  • Enter the OTP in the specified field
  • A new page with your photo and furnished details
  • Click on “Registration” and submit the details
  • Fill all the other information in the APCOS Online Application Form 2022 correctly
  • After filling the details, click on the “Save and Next” button
  • Upload the 10th, ITI, Inter, Degree, PG certificates, Caste certificate, etc
  • Next, go to Post Preferences
  • In this step, you have to select the post and district according to your preference from the available posts and districts
  • After the registration is completed, a confirmation will be sent to the registration email by APCOS

How To Apply for AP Outsourcing Jobs 2022

  • After completion of APCOS registration, you have to open the official website of APCOS
  • Check for the latest notifications on Home Page
  • Open the link and find the required advt
  • Click on the link and read the entire PDF carefully
  • If you are eligible then click on Apply online link
  • Later, Fill all details correctly
  • You are not allowed to make changes once the application submitted
  • Note down the application ID and password
  • Keep it safe for future reference

Candidates have to pay Rs 500/- for application. There is no fee for reserved candidates.

Frequently Asked Questions

Q. What is the APCOS Full Form?

Q. What is the selection process for AP Outsourcing jobs?

Q. How Can i Apply for APCOS Jobs Notifications?

Q. What is the Application Process for AP Outsourcing Jobs Notification?

Q. What is the Official Website of AP Outsourcing Jobs?

About Author

navya

As a content writer, I am offering the original information regarding latest govt job notifications and update the day to day new jobs.

Comments ( 1 )

I have 8 experience in Accounts and finance.. Please any out sourcing job is there..

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