Outsourcing Statistics

Outsourcing has become a core business strategy today, all thanks to talent shortages, digital transformation, and rising operational complexity. 

Among other reasons, companies outsource to gain access to specialized skills, adopt emerging technologies faster, and stay competitive in today’s market. 

The statistics in this article break down how and why organizations outsource.

Key outsourcing stats

• 42% of companies outsource primarily for access to specialized talent
• Global outsourcing market to exceed $1 trillion in 2026
• 92% of Global 2000 companies outsource IT functions
• IT outsourcing made up 83% of total outsourcing value in 2025
• 94% of AI-using companies rely on outsourced providers
• Software outsourcing growing at 7.5% annually through 2027
• Offshore IT outsourcing can cut labor costs by up to 70%
• Payroll outsourcing market to reach $11.17B in 2026
• HR outsourcing market to reach $72.6B by 2030
• China’s outsourcing market projected at $527B by 2030
• Nike outsources 100% of its manufacturing

Reasons for outsourcing

According to a Deloitte study, companies are increasingly turning to outsourcing to fill talent gaps, accelerate innovation, improve flexibility, and boost service quality.

• 42% of executives say access to specialized talent is now the top reason to outsource, surpassing cost reduction.

• Cost reduction as a top outsourcing driver dropped from 70% in 2020 to 34% in 2024, a 51% decrease over 4 years.
• Over 70% believe outsourcing helps manage distributed and remote teams more effectively.

IT outsourcing statistics

IT outsourcing remains one of the most widespread forms of external service delivery.  From software development to cybersecurity, outsourcing in IT is a multi-billion dollar market. 

Here are the key stats for perspective: 

• 92% of Global 2000 companies and 37% of small businesses outsource at least one IT function.
• More than 70% of organizations expect artificial intelligence and automation to be embedded in IT outsourcing contracts.
• IT outsourcing accounted for $24.6 billion in global contract value in early 2025, making up approximately 83% of total outsourcing.

Demand for IT outsourcing isn’t slowing; instead, it’s evolving toward smart outsourcing with AI, predictive analytics, and automation playing central roles. 

Payroll outsourcing statistics

Payroll remains a core function many companies outsource to handle complexity, compliance, and multiregional pay structures.

Below are key stats about payroll outsourcing. 

• The global payroll outsourcing market is projected to reach $11.17 billion in 2026.
• It is expected to grow to $19.48 billion by 2035, with a compound annual growth rate of approximately 6.3%.
• Over 60% of organizations use cloud-based payroll outsourcing for efficiency and compliance.
• Around 40% of multinational companies now integrate hybrid payroll solutions.

Software outsourcing statistics

Software outsourcing continues to expand rapidly, driven by growing demand for specialized skills, cost savings, and faster technology adoption.

Let’s take a look at some key stats about software outsourcing. 

• Software development outsourcing revenue could see an annual growth rate of about 7.5% through 2027.
• 94% of companies using AI and machine learning rely on outsourced providers to develop their technologies.
• The custom software development market alone could hit the $126 billion mark by 2026.
• IT services represent nearly 72% of the business generated by outsourcing firms.
• U.S. companies can save as much as 70% on labor costs by outsourcing IT services like web design, software engineering, and mobile app development offshore.

Regarding the types of IT functions outsourced globally, a Statista study involving 4, 498 CIOs and technology leaders across 86 countries found that:

• 64% of companies outsource software application development.
• 51% outsource software maintenance.
• 40% use outsourced data center services.
• 32% outsource IT infrastructure management.
• 29% outsource networks and systems integration.
• Other outsourced areas include HR BPO (12%), full IT departments (12%), IT BPO (12%), and knowledge process outsourcing (6%).

HR outsourcing statistics

HR outsourcing helps companies manage hiring, compliance, benefits, and employee services more efficiently.

Some key statistics about HR outsourcing include: 

• The global HR outsourcing market is worth about $55 billion in 2026, and is expected to reach $72.6 billion by 2030. 
• Approximately 57% of companies outsource at least one HR function.
• Around 87% of HR teams plan AI adoption through outsourcing partnerships.
• About 44% of firms outsource payroll through HR providers.

HR outsourcing providers offer a range of services, with the most common being HR consulting (45%), benefits administration (36%), and time tracking (24%). 

Insurance services and performance management are less frequently outsourced, at 19% and 10% respectively. 

Outsourcing to China statistics

China remains a key outsourcing destination, especially in manufacturing and business process services.

Let’s explore some key statistics about outsourcing to China. 

• China’s outsourcing services market is expected to reach about $527 billion by 2030, growing at an annual rate of 12.4%.
• China’s business process outsourcing segment alone was valued at $19.7 billion in 2024.

Nike outsourcing statistics

Nike’s business model leans heavily on outsourcing manufacturing to keep costs low and supply chains flexible.

Here’s what you need to know about Nike outsourcing stats.

• Nike outsources all its footwear and apparel production and owns no manufacturing plants itself.
• Around 80% of Nike products are produced by approximately 103 strategic suppliers.
• Nike’s footwear production is split roughly as 50% in Vietnam, 27% in Indonesia, and 18% in China.
• Over 90% of Nike’s products come from long-term supplier partners.
• More than half a million people across the globe are involved in the production of Nike footwear. 

Is outsourcing increasing or decreasing?

Despite some limited moves to bring work back in-house, outsourcing remains a growing global force.

Here’s why. 

• The global outsourcing market is projected to exceed $1 trillion in 2026.
• About 70% of organizations have brought some previously outsourced work back in-house, showing selective insourcing practices.
• Remote and virtual outsourcing engagements increased by 28 percent in 2024.
• Small business outsourcing adoption for functions like accounting and marketing is expected to rise to 54% in 2026. 

The outsourcing market continues to expand overall. Evolving priorities such as automation, compliance, and talent access outweigh pockets of insourcing. 

Remote work, digital transformation, and global talent shortages are all pushing more functions outward.

Conclusion

Perhaps the biggest lesson from this data is the fact that outsourcing is growing. And it is also changing. 

While cost reduction has declined as the primary driver, demand for skilled talent, advanced technology, and scalable delivery models continues to rise. 

From AI-powered IT services to globally distributed manufacturing networks, outsourcing is increasingly about long-term capability and resilience. 

As businesses navigate automation, remote work, and global competition, outsourcing is set to remain a central pillar of modern operations rather than a temporary solution.

Sources: Deloitte,  Business Research Insights, Hire With Near,  Research and Markets, Grand View Research