People often talk about the risks of the growing IT outsourcing market, like becoming too dependent or facing security issues.
But the benefits, like reaching global talent and reducing costs, are making it a popular choice.
Let’s dive into the latest IT outsourcing market size statistics.
Top 32+ Outsourcing Market Size Statistics (Editor’s Picks)
We’ve handpicked 32+ of the latest IT outsourcing market size statistics, facts, and trends. Here are 6 that we believe will blow you away.
| 1 | The IT Outsourcing market is currently valued at $617.69 billion |
| 2 | The IT Outsourcing market is expected to reach $806.53 billion by 2029 |
| 3 | North America leads IT outsourcing with 33.6% revenue share |
| 4 | IT services make up 75% of global outsourcing contracts |
| 5 | BFSI sector dominates IT outsourcing with 30.29% revenue share |
| 6 | India leads the global IT outsourcing market with over 55% market share |
Top IT Outsourcing Statistics at a Glance
64% of IT leaders globally outsource their software development (Statista)
This indicates that software development is the most common IT function that businesses prefer to outsource.
92% of G2000 companies outsource their IT tasks (ISG)
That’s a lot more compared to the 59% who outsource business processes, showing a clear preference for IT outsourcing among these top companies.
76% of executives outsource their IT functions (Deloitte)
This widespread outsourcing is mainly because it helps handle IT needs more efficiently. Companies do this to access specialized tech skills, control costs, and concentrate on their main goals. Outsourcing IT allows businesses to stay competitive by using outside expertise and the latest technology, without the cost of a big in-house team.
IT services make up 75% of global outsourcing contracts (ISG)
This sector reached $30.4 billion, a 13% increase from the previous year, marking its best year ever. Meanwhile, business services outsourcing fell by 14%, generating $10.3 billion.
Global IT Outsourcing Market Overview
The IT Outsourcing market is currently valued at $617.69 billion (Mordor Intelligence)
This value reflects IT’s role as a competitive advantage in many organizations. Beyond simple cost reduction, IT outsourcing now focuses on enhancing customer experience, business growth, and competitive disruption, especially with the adoption of cloud services.
The IT Outsourcing market is expected to reach $806.53 billion by 2029 (Mordor Intelligence)
It is growing at a CAGR of 5.48%. This growth comes from more than just cost savings. Companies are also focusing on improving customer experience, growing their business, and staying ahead of competition.
Average Cost Savings from IT Outsourcing
Outsourcing IT can save you up to $6,474/month (85% savings)
| Country | Average Salary |
| United States | $7,431 |
| China | $2,499 |
| Poland | $2,285 |
| Ukraine | $1,450 |
| Mexico | $1,378 |
| Malaysia | $852 |
| Vietnam | $589 |
| Argentina | $528 |
| Philippines | $395 |
| Brazil | $388 |
| India | $324 |
IT Outsourcing Market Size by Region
North America leads IT outsourcing with 33.6% revenue share (Mordor Intelligence)
North America’s lead comes from having many tech companies and adopting new technologies early. The U.S. drives this with its growing IT sector and more use of enterprise software and communication systems.
20% of US companies outsource all their IT support to other countries (Go Remotely)
Also, 15% send out all their app development and maintenance, and 10% do the same for their data management. It looks like this trend will continue, with about 9% to 11% of companies planning to outsource more IT work abroad.
Ukraine is a major center for IT outsourcing in Central and Eastern Europe (N-iX)
The country has seen its IT workforce grow to 200,000 professionals and hosts over 1,600 IT outsourcing companies, a number that has doubled over the past five years.
Asia Pacific will grow fastest at 10.3% CAGR (Mordor Intelligence)
Asia Pacific is set to grow quickly due to more partnerships between businesses and IT service providers. The region offers cost-effective software development and skilled developers.
India leads the global IT outsourcing market with over 55% market share (Gitnux)
This top position comes from its large number of skilled IT professionals and cost-effective services. India’s good English skills and commitment to quality also make it a preferred choice for companies needing IT outsourcing.
Asia Pacific is key for cost-effective IT outsourcing (Mordor Intelligence)
Companies outsource software development to Asia Pacific for its cost savings, high quality, good time management, and skilled developers.
Early tech adoption boosts North America’s IT revenue (Mordor Intelligence)
North America’s high IT outsourcing revenue is due to early adoption of new technologies, keeping the region ahead in advanced IT solutions.
North America has most tech-driven companies (Grandview Research)
North America leads in IT outsourcing because it has many tech-driven companies, ensuring high demand for IT services.
IT Outsourcing Market by Industry
BFSI sector dominates IT outsourcing with 30% revenue share (Grandview Research)
The BFSI sector’s substantial investment in technologies like automation and AI-based conversational systems resulted in it holding the largest revenue share in the IT outsourcing market.
Cybersecurity investments rise in BFSI through IT outsourcing (Grandview Research)
Due to rising cybersecurity threats, sectors such as BFSI are increasingly investing in robust IT security solutions through outsourcing.
Healthcare sector holds 23% of IT outsourcing market (Statista)
Driven by developments in tailored software platforms and big data applications, the healthcare sector represented 23.43% of the IT outsourcing market.
Big data pushes healthcare towards more IT outsourcing (Grandview Research)
The surge in big data usage within healthcare drives the sector towards more IT outsourcing to handle extensive data management needs effectively and securely.
Manufacturing sector holds 12% of IT outsourcing market (Statista)
The manufacturing sector’s growth is supported by increasing integration of IT services to enhance automation and smart manufacturing processes.
Telecom sector’s 15% market share due to IT investments (Statista)
Significant investments in outsourced IT services for network deployment and next-gen communications have given the IT & Telecom sector a substantial market share.
Retail and e-commerce to expand fastest in IT outsourcing with 9.7% CAGR (Statista)
Technological advancements in AI and virtual reality drive the rapid growth of the retail and e-commerce sector in IT outsourcing.
IT Outsourcing Trends
Over 75% of executives plan to outsource IT services (Radixweb)
The most common areas for outsourcing include IT infrastructure services, app and software development, and cybersecurity.
A 60% increase in revenue is seen by companies that effectively implement Agile (Harvard Business Review)
According to the Harvard Business Review, only 18% of companies have successfully mastered Agile, highlighting the difficulties in its implementation.
More than three-quarters of all executives reported plans to outsource IT functions (Deloitte)
Cybersecurity is the top area for outsourcing, followed by app and software development, and IT infrastructure services. This trend reflects the growing need for specialized IT skills and the strategic move to enhance security, innovation, and infrastructure management through outsourcing.
Women constitute about 16% of the global IT workforce (Wise)
This percentage matches the number of women who earn degrees in software engineering, also at 16%, according to data from Wise.
Outsourcing software development can cut the time-to-market for new products by 25% (Mckinsey)
This was highlighted in a McKinsey report on a global hotel chain that managed to speed up its software releases by outsourcing, demonstrating the efficiency benefits of such practices.
81% of executives view cybersecurity as their top technological challenge (Deloitte)
With cybersecurity being a critical concern, 3 out of 4 executives collaborate with external partners to enhance their security measures.
The IT sector is predicted to account for 14% of the world’s carbon footprint by 2040 (Netcorp)
This significant environmental impact makes the adoption of green software crucial. Sustainability is key not only for the planet but also for brands to build trust with environmentally conscious customers.
52% of companies use outsourcing for AI and Machine Learning consulting (Deloitte)
A recent study shows that this approach helps them fill the expertise gap in these rapidly evolving tech fields.
34% of companies are collaborating with external partners to support their Robotics Process Automation (RPA) efforts (Deloitte)
According to Deloitte, this partnership trend is expected to increase as RPA becomes more integral to business operations.
The demand for software developers, testers, and QA experts is expected to grow by 22% in 2030 (US Bureau of Labor)
This makes them the fastest-growing occupations in the country, according to projections by the US Bureau of Labor.
The custom software development market is projected to reach $126 billion by 2026 (Global Market Insights)
This growth, as reported by Global Market Insights, is driven by the increasing demand for customized solutions that meet specific business needs and integrate well with existing systems.
The average contract length for an IT outsourcing agreement is 5 years (Gitnux)
This time frame allows for a stable partnership, helping both the service provider and the client to plan better and achieve long-term IT goals. Longer contracts help ensure consistent improvements and more effective integration of IT services with business operations.
Conclusion
The IT outsourcing market is rapidly growing and shows no signs of slowing down.
Here are some standout points: the market is expected to increase from $617.69 billion to $806.53 billion by 2029, 92% of big companies outsource their IT tasks, and India leads with over 55% of the market. This trend suggests that outsourcing will become even more important for businesses looking to stay competitive.
As technology keeps advancing, outsourcing will likely play a crucial role in helping companies manage costs and access the best skills available.
FAQ
How big is the IT outsourcing industry?
The IT outsourcing industry is valued at over $617 billion and is projected to reach approximately $806.53 billion by 2029.
What percentage of work is outsourced in the IT industry?
About 64% of IT leaders globally outsource their software development, which is the most common IT function that businesses prefer to outsource.
What is the most commonly outsourced IT service?
Software development is the most commonly outsourced IT service, as it allows companies to access specialized skills and advanced technologies without the overhead of full-time staff.
When should you outsource IT services?
You should outsource IT services when you need to scale operations quickly, access specialized skills not available in-house, or reduce costs while maintaining or improving service quality.