40+ Outsourcing Statistics & Trends: The Power of Delegation [2024]

February 19, 2024 0 Comments

Ever wondered how outsourcing revolutionizes businesses and fuels growth? 

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

According to recent data, 59% of company executives prefer outsourcing due to its cost benefits and 21% of companies believe that outsourcing enables flexibility along with effective adaptability of the task.

Are you aware that 84.2% of global outsourcing jobs are generated in the US?

Ready to dive deeper? Here’s a glimpse into the outsourcing statistics shaping the business landscape.

Top Outsourcing Statistics: Editor’s Pick

84.2% of global outsourcing jobs are generated in the US
  1. Large businesses are 128% more likely to outsource work than small businesses. [5]
  2. 80% of small businesses have started outsourcing at least some of their work in 2022. [5]
  3. Outsourcing reduces employee’s time on projects by 11%. [8]
  4. 59% of businesses outsource to cut costs on certain projects. [13]
  5. One-third of working professionals do not support outsourcing. [16]
  6. The US manufacturing industry is being affected by outsourcing. [3]
  7. 4% of American companies are planning to relocate outsourcing jobs back to the US. [2]
  8. The value of the global outsourcing market was $92.5 billion in 2019. [6]

Outsourcing Statistics By Industry & Company Size

Which businesses outsource their work the most?

Large businesses are 128% more likely to outsource work than small businesses. [5]

80% of small businesses have started outsourcing at least some of their work in 2022. [5]

It is interesting to note that 29% of businesses with 50% or fewer employees outsource work compared to 66% of businesses with more than 50 employees. [4]

68% of large consumer product-based companies in the US use outsourcing. [10]

71% of financial service executives outsource a few services. [10]

Healthcare outsourcing services are expected to reach $229.2 billion. [3]

Customer services are expected to reach $81.5 billion by the end of 2023. [3]

top outsourcing services
  • 37% of companies outsource accounting/IT services. These services are projected to reach $397 billion by the end of 2025. [4]
  • 34% of companies outsource digital marketing work. [4]
  • 29% of companies outsource development work. [4]
  • 24% of companies reported outsourcing HR and customer support services. [4] 

Why Do Businesses Prefer Outsourcing?

Curious to know the reasons why businesses prefer outsourcing?

21% of companies believe that outsourcing enables flexibility along with effective adaptability of the task. [8]

Outsourcing reduces employee’s time on projects by 11%. [8]

10% of employees believe it helps them gain proper guidance and help from experts. [8]

7% of companies report outsourcing is cheaper than hiring office employees. [13]

6% think it processes better tax breaks. [13]

59% of businesses outsource to cut costs on certain projects. [13]

26% of small businesses confirm that they outsource to get help from experts in the field. [1]

Modes of Outsourcing Communication Statistics

Curious how outsourcing workers usually communicate?

  • 25% of outsourcing employees prefer emails for communicating. [14]
  • 25% of outsourcing employees confirmed they communicate with employers through video conferencing. [14]
  • 20% of outsourcing employees contact their employees via phone calls. [14]
modes of outsourcing communication statistics

53% of outsourcing workers communicate daily with their employers. [15]

38% of employees providing outsourcing services communicate weekly with their employers. [15]

Only 8% of outsourcing workers communicate with their employers monthly. [15]

Benefits of Outsourcing Statistics

How helpful has outsourcing been in business growth?

Along with cost benefits, employees working for companies that outsource report a 66% increase in job security. [16]

Authorities confirmed that US immigration rates have been reduced due to outsourcing. [16]

One-third of working professionals do not support outsourcing. [16]

As machine learning automation is being highly adopted by IT outsourcing service providers, the quality of work has improved significantly. [15]

major benefits of outsourcing

Impact of Outsourcing On Economy

Outsourcing sounds great, right?

Let’s take a glance at the other side.

The US manufacturing industry is being affected by outsourcing. [3]

The manufacturing industry lost 8 million American workers between 1979 and 2009. [9]

Are you aware that developed countries like the US outsource their work from developing countries like Argentina, Thailand, Pakistan, India, Turkey, and Nigeria? [7]

where do outsourcing workers belong

According to the latest research reports, the top five countries to outsource are China, the Philippines, Taiwan, Ukraine, and Vietnam. [11]

4% of American companies are planning to relocate outsourcing jobs back to the US. [2]

84.2% of global outsourcing jobs are generated in the US. [12]

42% of international outsourcing is happening in North America and South America. [2]

The next in line is the UK, generating 5.2% of global outsourcing jobs. [2]

Challenges Faced By Small Businesses In Outsourcing

Why are small businesses not highly involved in outsourcing?

Here we have curated a list of common challenges faced by small businesses looking to outsource.

ChallengesPercentage of Small Businesses
The cost is too high23%
Lack of communication21%
Failed to meet deadlines14%
Didn’t follow instructions12%
Lack of confidentiality95
Poor quality Services9%
Data breach8%
Other5%

According to the latest statistics, 83% of US small businesses have increased the process of outsourcing. [8]

11% of small businesses have no plans for outsourcing. [8]

6% of small businesses are unsure of the trend. [8]

Based on recent data, the Outsourcing market has grown by $15.6 billion since 2016. [6]

The value of the global outsourcing market was $92.5 billion in 2019. [6]

The global outsourcing value was at $76.9 billion in 2016. [6]

The overall international outsourcing market is expected to grow at a CAGR of 4% in the coming four years. [6]

The international market is projected to grow by $40.16 billion by 2025. [6]

70% of companies are planning to outsource more work in the coming years. While the 35% plan increases the number of jobs they outsource. [1]

Only 38% of global outsourcing market growth will happen in the US. [1]

FAQs

What are the US outsourcing statistics?

66% of US businesses with 50 or more employees outsource, and only 29% of small businesses with less than 50 employees outsource. 82.4% of outsourcing jobs are generated in the US.

What percentage of US jobs are outsourced?

About 4.5%, that is around 300k jobs are outsourced every year in the US.

Which countries do the most outsourced work?

Argentina, Mexico, Thailand, Pakistan, India, Turkey, and Nigeria are the top countries that do the outsourced work.

How much is the outsourcing market expected to grow?

The overall international outsourcing market is expected to grow at a CAGR of 4% in the coming four years. The outsourcing market is projected to grow by $40.16 billion by 2025.

Conclusion

With globalization, outsourcing has become an important strategy for businesses to cut costs and hire experts with flexibility for their projects. While large-scale businesses have confirmed the benefits of outsourcing and are using it the most, small-scale businesses still need help to accept the new trend.

Though US citizens are suffering job loss, especially in the manufacturing industry, 42% of international outsourcing is happening in North America and South America.

Based on recent data, the outsourcing market has grown by $15.6 billion since 2016. The international outsourcing market is projected to grow by $40.16 billion by 2025. 

Sources

  1. Statista. Global Outsourcing Market Size 2000-2019.
  2. Statista. Outsourcing Penetration Rate In North America By Country 2019.
  3. Statista. Global Outsourcing Industry Revenue From 2010 to 2019, By Service Type.
  4. U.S. Bureau of Labor Statistics. Service-Providing Occupations, Offshoring, And The Labor Market.
  5. PR Newswire. 80% Of Small Businesses Plan To Outsource In 2021, Citing The Ability To Save Time, Grow Their Business And Work With Experts.
  6. PR Newswire. Business Process Outsourcing Market To Grow By USD 40.16 Billion During 2021-2025.
  7. CNBC. The New Outsourcing Hot Spots: More Developing Nation Firms Tap Workers In U.S., Canada, Europe.
  8. Super Staff. Important Outsourcing Trends And Statistics You Need To Know In 2020 (And Beyond).
  9. Population Reference Bureau. Offshoring U.S. Labor Increasing.
  10. Reliable Plant. 68% of U.S. Consumer Products Companies Use Outsourcing.
  11. Business Insider. The 5 Best Countries To Outsource To In 2019—Plus, The Top 14 Outsourcing Companies Data Entry Agencies.
  12. KPMG. Global IT-BPO Outsourcing Deals Analysis
  13. Outsource Accelerator. How Outsourcing Can Cut Labor Costs By Up To 70%.
  14. Devabit. The Future Of IT Outsourcing.
  15. Walden University. Role Of Outsourcing In Stress And Job Satisfaction Of Information Technology Professionals.
  16. Invedus. Outsourcing Statistics 2023