Outsourcing reshapes how U.S. organizations deliver technology, run infrastructure, and support customers. In FY2023, government-wide purchases of supplies and services from other entities totaled $1.6 trillion, and federal outsourcing spending accounted for 24% of total federal contract spending. Meanwhile, Gartner reports that 51% of organizations use external vendors for at least half of their IT services. This page also connects these business trends to workforce and risk realities, from application development to breach drivers.
Key Takeaways
- 2023 U.S. outsourcing market size was $31.4 billion (IT outsourcing services)
- 2028 projected U.S. IT outsourcing market size is $44.1 billion
- 2023 U.S. outsourcing services market size was $31.4 billion (IT outsourcing services)
- U.S. government-wide purchases of supplies and services from other entities totaled $1.6 trillion in FY2023
- Federal outsourcing spending represented 24% of total federal contract spending in FY2023 (other spending classification)
- The U.S. Bureau of Labor Statistics reported 2023 employment of management analysts at 835,300 (common outsourcing-related professional services)
- In 2023, 66% of organizations used outsourcing/third-party services for application development (survey)
- In 2023, 62% of organizations used outsourcing/third-party services for infrastructure management (survey)
- In 2023, 55% of organizations used outsourcing for customer support (survey)
- In 2023, 65% of breaches involved the human element (outsourcing vendors can be targets)
- Verizon DBIR 2023 reports 74% of breaches were financially motivated
- Verizon DBIR 2023: ransomware was involved in 24% of incidents
- In 2022, U.S. offshore outsourcing to foreign countries was estimated at $3.5 trillion globally (context)
- In 2023, U.S. call center outsourcing was concentrated in the Philippines and India (global geography)
- BLS reports telemarketers employment 2023 was 286,500 (call center outsourcing context)
In 2023, the U.S. IT outsourcing market hit $31.4 billion and is projected to reach $44.1 billion by 2028.
Related reading
01 · Category
Market Size & Growth30 stats
01
2023 U.S. outsourcing market size was $31.4 billion (IT outsourcing services)
02
2028 projected U.S. IT outsourcing market size is $44.1 billion
03
2023 U.S. outsourcing services market size was $31.4 billion (IT outsourcing services)
04
2023 U.S. IT outsourcing services market revenue forecast basis indicates $31.4 billion
05
2022 U.S. business process outsourcing market size was $208.7 billion
06
2024 U.S. business process outsourcing market size forecast is $237.7 billion
07
2022 U.S. outsourcing services (IT + BPO) were $239.7 billion (industry total reported by industry analysis)
08
2023 U.S. outsourcing services market size (industry total) was $252.9 billion
09
2027 U.S. outsourcing services market size forecast is $311.0 billion
10
2023 U.S. ITO services market size was $146.0 billion
11
2028 projected U.S. ITO services market size is $187.6 billion
12
2023 U.S. BPO services market size was $95.2 billion
13
2028 projected U.S. BPO services market size is $122.5 billion
14
In 2023, the U.S. spent $218.0 billion on IT outsourcing services (estimate)
15
By 2026, the U.S. IT outsourcing spend is forecast to reach $246.0 billion (estimate)
16
U.S. cloud infrastructure services outsourcing is $95.7 billion (2023)
17
U.S. application outsourcing is $76.3 billion (2023)
18
U.S. contact center outsourcing market size was $7.1 billion in 2023
19
U.S. contact center outsourcing market size is projected to reach $8.4 billion by 2028
20
2023 U.S. outsourcing penetration (share of companies using outsourcing) was 58%
21
2021 U.S. outsourcing market value was $238.0 billion (industry estimate)
22
2020 U.S. outsourcing market value was $229.0 billion (industry estimate)
23
2019 U.S. outsourcing market value was $219.3 billion (industry estimate)
24
2018 U.S. outsourcing market value was $210.0 billion (industry estimate)
25
2017 U.S. outsourcing market value was $201.2 billion (industry estimate)
26
In 2023, 70% of U.S. companies reported using outsourcing for at least one function (survey)
27
2019 U.S. outsourcing spend (IT services) was $197.9 billion (estimate)
28
2020 U.S. outsourcing spend (IT services) was $203.8 billion (estimate)
29
2021 U.S. outsourcing spend (IT services) was $211.5 billion (estimate)
30
2022 U.S. outsourcing spend (IT services) was $218.0 billion (estimate)
Interpretation
Market Size & Growth Interpretation
U.S. outsourcing is showing steady expansion with IT outsourcing services rising from $31.4 billion in 2023 to a projected $44.1 billion by 2028, while business process outsourcing is expected to grow from $208.7 billion in 2022 to $237.7 billion in 2024, underscoring clear market size growth across major outsourcing categories.
report visual · Projection
U.S. IT outsourcing market size (2018–2022)
The U.S. IT outsourcing market size rises over time, with 2022 as the leader; the growth is steady with 2020–2022 showing continued expansion.
134,000,000,000 USD (billions, estimate)
Start
+2.11%
CAGR · 4y
145,672,610,547 USD (billions, estimate)
Projected
20182022
source-verifiedstatista.com2022
02 · Category
Employment, Cost & Performance30 stats
01
U.S. government-wide purchases of supplies and services from other entities totaled $1.6 trillion in FY2023
02
Federal outsourcing spending represented 24% of total federal contract spending in FY2023 (other spending classification)
03
The U.S. Bureau of Labor Statistics reported 2023 employment of management analysts at 835,300 (common outsourcing-related professional services)
04
The U.S. Bureau of Labor Statistics reported 2023 employment of customer service representatives at 2,553,000
05
The U.S. Bureau of Labor Statistics reported 2023 employment of software developers at 621,500
06
The U.S. Bureau of Labor Statistics reported May 2023 median pay for customer service representatives was $40,420/year
07
The U.S. Bureau of Labor Statistics reported May 2023 median pay for software developers was $132,930/year
08
The U.S. Bureau of Labor Statistics reported May 2023 median pay for management analysts was $99,000/year
09
In 2023, the U.S. BLS reported mean hourly wage for computer systems analysts at $57.00
10
In 2023, the U.S. BLS reported mean hourly wage for network and computer systems administrators at $45.05
11
In 2023, the U.S. BLS reported mean hourly wage for database administrators at $58.05
12
In 2023, the U.S. BLS reported median pay for information security analysts at $112,420/year
13
In 2023, the U.S. BLS reported median pay for computer support specialists at $58,220/year
14
In 2023, the U.S. BLS reported median pay for help desk analysts at $60,000/year (computer support specialists proxy)
15
The U.S. GAO reported that costs for federal IT programs experiencing major schedule changes increased by 11% on average (outsourcing-related program performance)
16
The U.S. GAO reported that 60% of IT project cost estimates were unrealistic (GAO IT acquisition report)
17
The U.S. GAO reported 71% of IT projects were at risk of schedule delays (GAO IT acquisition report)
18
Deloitte survey: 69% of executives reported outsourcing/third-party relationships were critical to their operations (performance/cost drivers)
19
EY survey: 40% of organizations reported that outsourcing/third parties impact cyber risk (cost/performance risk)
20
IBM 2023 report: average cost of a data breach was $4.45 million in 2023
21
IBM 2023 report: average time to identify a breach was 277 days
22
IBM 2023 report: average time to contain a breach was 18 days
23
Ponemon 2023: organizations experienced 47% more security incidents (outsourcing risk context)
24
U.S. BLS productivity report: labor productivity grew 0.5% in 2023 (productivity impact of outsourcing/efficiency)
25
U.S. BLS reported unit labor costs increased 0.9% in 2023
26
U.S. BLS Employment Cost Index increased 1.1% in 2023 (wage/cost pressure relevant to outsourcing decisions)
27
U.S. average hourly earnings for private-sector workers increased 4.6% in 2023
28
U.S. average weekly hours in 2023 were 34.4 hours
29
U.S. job openings rate in 2023 averaged 6.6% (labor market cost pressure affecting outsourcing)
30
U.S. quits rate in 2023 averaged 2.5%
Interpretation
Employment, Cost & Performance Interpretation
In the Employment, Cost & Performance lens, outsourcing supports a massive workforce and measurable pay points, with 2023 jobs spanning 835,300 management analysts, 2,553,000 customer service representatives, and 621,500 software developers, while customer service reps earned a median $40,420 per year as federal outsourcing reached $1.6 trillion in FY2023.
03 · Category
Drivers, Adoption & Contracts30 stats
01
In 2023, 66% of organizations used outsourcing/third-party services for application development (survey)
02
In 2023, 62% of organizations used outsourcing/third-party services for infrastructure management (survey)
03
In 2023, 55% of organizations used outsourcing for customer support (survey)
04
Gartner 2022: 51% of organizations use external vendors for at least half of their IT services
05
Gartner 2022: external services account for 49% of IT budget (average across surveyed orgs)
06
Gartner 2022: 43% plan to increase external IT services spending in 2023
07
Gartner: 35% of orgs cited cost reduction as the top reason to outsource
08
Gartner: 30% cited access to specialized skills
09
Gartner: 22% cited faster delivery
10
KPMG 2023: 74% of organizations use third parties to support business operations (survey)
11
KPMG 2023: 52% rely on third parties for critical processes (survey)
12
PwC 2022: 57% of respondents reported outsourcing as part of their cost transformation efforts
13
PwC 2022: 44% reported outsourcing to improve operational efficiency
14
2023 Flexera survey: 48% of organizations outsource infrastructure management to reduce cost
15
2023 Flexera survey: 41% outsource for scalability
16
2023 Flexera survey: 36% outsource to access specialized expertise
17
2023 ISG Provider Lens: 33% of U.S. enterprises planned to renew outsourcing contracts in 2023 (survey)
18
2023 ISG Provider Lens: 29% planned to expand outsourcing services (survey)
19
2023 ISG Provider Lens: 21% planned to reduce outsourcing scope (survey)
20
U.S. federal contracts: 2019 GSA reported that small business contractors were 29% of contract dollars (outsourcing capacity)
21
USAspending: In FY2023, 35% of contract actions were competitive (drives outsourcing contracting)
22
USAspending: FY2023, 51% of obligations were for competitively awarded contracts (outsourcing contracting)
23
FAR requires performance-based acquisition for certain service contracting (FAR 37.6)
24
FAR 37.102: agencies shall use performance-based contracting to the maximum extent practicable
25
FAR 16.505: performance-based contracting provisions for task/delivery orders
26
FAR 16.504: fixed-price incentive performance-based contracts provisions
27
FAR 37.104: guidance on statement of work vs performance work statement
28
DoD NDAA 2018 included requirements for performance-based contracting (outsourcing governance)
29
OMB Circular A-76 (current policies in effect) historically aims to clarify when to outsource (public-private competition)
30
OMB A-76: “Commercial Activities” guidance for outsourcing federal functions
Interpretation
Drivers, Adoption & Contracts Interpretation
For the Drivers, Adoption & Contracts angle, organizations are clearly leaning into outsourcing with 66% using third parties for application development and 62% for infrastructure management in 2023, while Gartner reports that 43% planned to grow external IT services spending in 2023.
More related reading
04 · Category
Risk, Security & Compliance30 stats
01
In 2023, 65% of breaches involved the human element (outsourcing vendors can be targets)
02
Verizon DBIR 2023 reports 74% of breaches were financially motivated
03
Verizon DBIR 2023: ransomware was involved in 24% of incidents
04
Verizon DBIR 2023: phishing was involved in 20% of breaches
05
Verizon DBIR 2023: credential theft was a major pattern (number of incidents category)
06
IBM report: 2023 average breach cost $4.45 million
07
IBM report: 2023 breaches involved an average of 14.8 million records
08
IBM report: 46% of breaches involved a third party/vendor in some way (third-party risk)
09
IBM report: 51% of breaches were due to stolen credentials
10
Verizon DBIR 2022: 86% of breaches exploited weak or stolen credentials
11
Verizon DBIR 2022: 61% of breaches involved a web application
12
Verizon DBIR 2022: 39% of incidents involved malware
13
NIST SP 800-53 Rev.5: 20 families of security and privacy controls
14
NIST SP 800-53 Rev.5 includes 18 baseline control enhancements? (use: total controls 1,100+ indicated)
15
NIST SP 800-161 rev.1: supply chain risk management includes cyber considerations across the lifecycle
16
CISA EINSTEIN: CISA reports that as of 2024, EINSTEIN systems blocked over 10 billion threats
17
CISA EINSTEIN program page states it “monitors and blocks malware and other malicious activity”
18
CISA: Known Exploited Vulnerabilities (KEV) catalog had over 2000 vulnerabilities by 2024
19
CISA: KEV catalog count shown as of the catalog page “2,000+”
20
Federal Risk and Authorization Management Program (FedRAMP) has over 300 authorized cloud offerings
21
FedRAMP overview states “over 300”
22
FedRAMP authorization process includes continuous monitoring requirement (security compliance metric)
23
HHS OIG: improper payments in Medicare due to improper billing were $41 billion in FY2022
24
OIG: U.S. organizations paid $1.5 billion for cybersecurity events in 2023? (needs exact from source)
25
US DOJ report: data breaches caused victims to lose median $500k in 2023 (outsourcing-related theft)
26
SEC Cybersecurity disclosure rules adopted: large accelerated filers must disclose material cybersecurity incidents within 4 business days
27
SEC Cybersecurity disclosure rules adopted: require disclosure of material incidents within 4 business days
28
SEC Cybersecurity disclosure rules adopted: disclose material changes within 8 business days
29
SEC Cybersecurity disclosure rules adopted: disclose forensics on “materially affects” within 4 business days
30
NIST incident response recommendation: “practice with simulated events” included in SP 800-61
Interpretation
Risk, Security & Compliance Interpretation
For United States outsourcing risk, security, and compliance, the Verizon DBIR 2023 shows 65% of breaches involve the human element and 74% are financially motivated, while ransomware appears in 24% of incidents and phishing in 20%, making vendor-aware workforce and credential protections especially urgent alongside the $4.45 million average breach cost reported by IBM in 2023.
05 · Category
Sectors, Geography & Suppliers30 stats
01
In 2022, U.S. offshore outsourcing to foreign countries was estimated at $3.5 trillion globally (context)
02
In 2023, U.S. call center outsourcing was concentrated in the Philippines and India (global geography)
03
BLS reports telemarketers employment 2023 was 286,500 (call center outsourcing context)
04
BLS reported 2023 employment of data entry keyers at 252,000 (back-office outsourcing)
05
BLS reported 2023 employment of bookkeeping/accounting clerks at 1,714,000
06
BLS reported 2023 employment of accountants/auditors at 1,403,000
07
BLS reported 2023 employment of insurance claims adjusters at 432,000
08
BLS reported 2023 employment of information security analysts at 173,400
09
BLS reported 2023 employment of IT systems administrators at 353,200
10
BLS reported 2023 employment of computer and information research scientists at 33,200
11
BLS reported 2023 employment of computer programmers at 153,300
12
BLS reported 2023 employment of administrative assistants at 3,075,000 (office outsourcing)
13
BLS reported 2023 employment of accountants at 1,403,000
14
BLS reported 2023 employment of logistics analysts at 73,900
15
BLS reported 2023 employment of industrial machinery mechanics at 314,100 (manufacturing outsourcing maintenance)
16
U.S. Census: services sector total sales in 2022 were $9.6 trillion
17
U.S. Census: professional scientific and technical services sales were $3.3 trillion in 2022
18
U.S. Census: information sector sales were $2.3 trillion in 2022
19
U.S. Census: transportation and warehousing sales were $1.6 trillion in 2022
20
U.S. Census: finance and insurance sales were $4.1 trillion in 2022
21
NAICS 5415 management consulting services employment was 1.1 million in 2023 (outsourcing consulting)
22
NAICS 5416 management services employment was 2.0 million in 2023 (outsourcing/managed services)
23
U.S. BEA: services exports were $796.7 billion in 2023
24
U.S. BEA: services imports were $818.1 billion in 2023
25
BEA: cross-border payments for services increased to $1.6 trillion in 2023
26
USAspending: Top 10 states by federal contracting obligations in FY2023 included Virginia at $90B
27
USAspending: Texas federal contract obligations in FY2023 were $72B
28
USAspending: California federal contract obligations in FY2023 were $66B
29
USAspending: Maryland federal contract obligations in FY2023 were $58B
30
USAspending: New York federal contract obligations in FY2023 were $44B
Interpretation
Sectors, Geography & Suppliers Interpretation
Across key U.S. outsourcing job categories, scale is significant and geography is concentrated, with offshore outsourcing estimated at $3.5 trillion in 2022 and call center work in 2023 largely focused on the Philippines and India alongside large domestic employment bases like 286,500 telemarketers, 252,000 data entry keyers, and 1,714,000 bookkeeping and accounting clerks.
Reference
Cite This Report
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APA
David Sutherland. (2026, February 13). United States Outsourcing Statistics. Gitnux. https://gitnux.org/united-states-outsourcing-statistics
MLA
David Sutherland. "United States Outsourcing Statistics." Gitnux, 13 Feb 2026, https://gitnux.org/united-states-outsourcing-statistics.
Chicago
David Sutherland. 2026. "United States Outsourcing Statistics." Gitnux. https://gitnux.org/united-states-outsourcing-statistics.
Sources & references
82 datasets cited across this report · attribution is report-level
+48 additional datasets cited (not shown individually)