Offshoring is here to stay. Period! Offshoring remains an indispensable business tool in a time of global crisis. There are no doubts that offshore staffing helps you cut costs, saves time, and increases productivity. Consequently, you reap the dividends of better revenues, even during a calamity or God-made crisis. In this blog, we’ll discuss some of the cost-saving benefits of offshore staffing and how this strategy helps make a business profitable.

Offshore staffing solutions maximize value and help you better serve your customers; that’s why enterprises in western countries like the US, Canada, and the UK prefer offshoring to achieve efficiency.

Be it a coronavirus-like pandemic or an economic slowdown, or The Great Resignation, you are never out of the game with offshore staffing. Offshoring allows you to break geographical barriers and give your business a global presence.

Finding and retaining talent has become problematic recently, but offshoring addresses some common hiring challenges by providing a top-notch and affordable workforce. The demand for skilled offshore labor has surged over the past few years, but covid-19 pandemic doubled up the need for employees working remotely. In fact, it is an excellent opportunity to upgrade your IT talent.

One of the primary benefits of offshoring and outsourcing is cost savings. A business can save a lot through this strategy, increase productivity and become profitable. Even though offshoring and outsourcing are entirely different, the two terms are often used interchangeably.

What is offshoring in business?

Many businesses have grown exponentially by utilizing and enhancing their workforce with offshore staffing. Working with an offshore staffing agency is vital as the company’s fate depends on the service providers.

Offshoring also means opening the door to a talent pool, allowing you to handpick employees without geographical constraints. This becomes essential and saves you from losing out on potential clients, especially during a holiday season when local labor is less available. Recruiting skilled and educated labor in offshore locations such as India enables in-house and offshore teams to work together for better output. Offshore staffing is an ideal strategy for hiring IT talent. So, choosing the right strategy for offshoring your business becomes imperative for scalability.

Offshoring is not just about cost savings but also a chance to expand overseas business operations.

Cost-Saving Benefits Of Offshoring

  • Hiring: Offshore staffing comes with cost-saving benefits, and organizations can save a lot of money in various ways. Recruitment is tedious as the process is not only lengthy, but it also affects the expenses of the company. However, offshoring solutions save costs by taking the operation under its control. They take care of the pre-employment testing, background investigations, and drug screening before hiring a candidate.
  • Training: Another cost-savings benefit of offshoring is when a specified job is offshored, the company is spared the expense of hiring qualified individuals. The work is assigned to experts in that field, improving the work’s efficiency and quality. Meaning there will be no need to plan training sessions for the same.
  • Labor: Offshore offers affordable labor, providing another cost-saving benefit to the business they partner with. Whether skilled workers are scarce or available at a high cost, offshore includes access to talent fluent in English with relevant skill sets and experience.

Revenue Growth

Offshore staffing has proven to be a viable option for ramping up the business. With offshore staffing, you can expand your company according to your needs, finances, or functionalities without adversely affecting the bottom line. Let’s look at how offshore staffing helps in building revenue.

Revenue Growth
  1. Business expansion: The offshore strategy is a perfect way to spread awareness about the business company in different parts of the world. This is helpful in terms of gaining more clients worldwide. Agencies providing offshore staffing solutions play an essential role in business development. Offshoring allows you to free internal resources that can be used as assets to fuel the company’s growth. The tool quickly responds to rising demand, enabling you to concentrate on methods to grow your business.
  2. Diverse Talent Pool: Offshore IT staffing has a broader pool of talent with quality skills available for work at lower wages. It may not be easy to recruit workers with specialized skills locally, but offshoring allows you access to such workers.
  3. Access to Resources: Resources like technology that are hard to find locally could be easily accessible to offshore locations. Hence, giving you better access to necessary resources for smooth business operations.
  4. Working round the clock for improved TAT: Even if you have retired for the day, offshore staffing ensures the project they are working on remains uninterrupted. Working round the clock allows for faster turn-around times (TAT), bringing consistent results and business escalation.
  5. Risk Management: Offshoring comes with its own challenges, and even the slightest risk could affect the overall workflow. However, offshore staffing ensures mitigating those risks, whether operational or strategic, for smooth functioning.

How India has become a favored offshoring destination

With its large economy and digital-ready population, India has been the hub for outsourcing and offshoring for over two decades. It matches the quality, talent, and fluency in English, all at relatively lower rates than you would pay for the same services in the US, Canada, or some other western country. Hiring a skilled workforce at 60-70% cheaper rates than your local market is potentially the key to unlocking doors for better results.

Finding qualified talent in India with relevant skills and experience is the icing on the cake as you not only save cost upfront but also help scale your business up gradually. A large section of the country speaks, writes, and reads English, and that gives India an edge over other offshore locations.

1. Improved Education Quality

In the IT sector, India has emulated Western countries’ education and practical knowledge. The knowledge and skillsets of Indian workers are attractive enough to lure businesses worldwide. Approximately 65 lakh students graduate annually in India, including 15 lakh engineers, making the country the third largest in producing engineering and technology graduates annually.

2. Cost of living becomes game-changer

Living costs have become a game-changer for businesses taking the offshoring route. In the USA, the cost of living is 80% higher than that in India. According to Living Cost, the average cost of living in India for one person is $416 compared to $2112 in the US.

3. Government support

India has become the number one offshore location choice for businesses because of its favorable and supportive government policies. Thanks to the IT Act, India has been rated as an investment potential destination as it provides numerous benefits, including tax and e-filing documents.


Offshoring has become one of the popular tools businesses globally utilize to stay relevant in the highly competitive world. Offshoring has been an effective business strategy, especially during the pandemic, with big brands heavily reliant on this method. Offshoring provides cost-saving benefits and helps your business sell more and build revenues.

The term ‘offshore outsourcing’ was coined in the 1900s by economists when only some of the basic ‘blue collar’ jobs were exported. Gradually, as the offshore staffing technique evolved to encompass a broader range of services, employers started following the offshoring staffing trends for ‘white collar’ jobs. Fast-forward to the mid-20s, the tech revolution witnessed by the industry made it almost impossible to fill the talent gap without the help of offshore employees.

Partnering with offshore staffing solutions ranks among the most successful business strategies for growth today, and it continues to advance as leaders come to realize the benefits of offshoring. Here are some of the significant trends that are shaping offshoring practices today.

1. Increased focus on Cybersecurity

With data at the center of business functions today, a robust cybersecurity mechanism has become more critical than ever. Data breaches can incur a high cost to the company in terms of money and time. According to a 2021 study by Cybersecurity Ventures, global cybercrime is expected to grow at a rate of 15% annually, causing global economies to lose out on $10.5 trillion annually by 2025.

Data security concerns become even more pronounced with the offshore staffing trends when you have teams distributed across the globe. That’s when having a trusted offshoring partner is almost a necessity. A qualified offshore staffing agency employs certified security systems that can protect your company’s confidential data from intrusion.

Ensure you know the fundamental security frameworks for mitigating risks and protecting sensitive information. Safeguard all your devices and company systems, and most importantly, provide cybersecurity training to all your employees.

2. Quality over cost

It is only a myth that IT offshoring is mainly about cutting back on costs, even if it means compromising quality. The truth is- with time, leaders have come to realize the importance of quality hiring over anything else.

As the demand for cutting-edge skills increases, companies are left with no option but to prioritize hiring skilled professionals. According to a study by Korn Ferry, the US could suffer a loss of about $162 billion annually in the tech domain if it failed to find more skilled workers.

Hiring skilled professionals benefits you with a great ROI and prevents your company from losing out on revenue caused due to missing opportunities, high turnaround time, lost clients, and low-quality work.

3. Technology upgrade

Digital tech transformation has taken the industry by storm, and offshore staffing is no exception. About 85% of leaders believe that digitization is a pre-requisite for success today, says a study by Deloitte Digital and MIT Sloan Review. Here are some of the top tech trends of outsourcing.

  • Advanced collaboration tools- Most of the work happens remotely with offshore teams, and technology forms the backbone of all business processes. Having a reliable setup for communication and collaboration is a must for getting a job done from a network of remote employees.
  • Artificial Intelligence (AI)- Most organizations are integrating AI into their day-to-day functions to automate repetitive tasks. This helps increase the speed of work and allows them to utilize human resources more effectively and engage them in more strategic tasks.
  • Cloud Technology- Cloud technology has transformed the way companies used to store, retrieve, and access data. Most importantly, it allows organizations to maintain bullet-proof security and protect sensitive data from unauthorized access. Creating a winning cloud strategy can go a long way in driving your business ahead of competitors.
  • Internet of Things- According to CompTIA, about 6 of every ten companies today look forward to implementing some or the other form of IoT initiative in their business. IoT technology offers massive potential when it comes to improving customer experience, as well as enhancing internal operations.
4. Upskilling of staff

Given the fast-paced nature of the business world today, companies need to upskill and reskill their employees to match market standards constantly. Staff upskilling is no longer just an offshoring trend, it has become a necessity for every business. A study by Gartner reveals that only 16% of new joiners are capable of carrying out their job role. Offshore staffing provides a great opportunity for you to upgrade your workforce.

Employers today understand that a company can progress only if its employees keep upskilling themselves. The pandemic has taught us that no skill has a permanent position in the market and that anything can go redundant, anytime. The need of the hour is to build an agile and adaptive workforce that can quickly acquire new skills and apply them to generate results.

Besides, regular training and workshops have also been found to increase employee satisfaction and retention by making workers feel more valued. Most of them prefer to stay at an organization that invests in their upskilling.


The offshoring trend became even more vital as the pandemic pushed us to adapt to the new normal. Tech giants like Microsoft, Apple, Google, and many others are writing success stories by offshoring a considerable chunk of their business operations, and we believe you can write one too. What began as a mere cost-cutting measure has now become one of the most successful business strategies.

Frequently Asked Questions

Is offshore staffing still relevant in today’s world?
Yes, in fact more and more companies are switching to offshore staffing to bring down operating costs and hire high quality talent.
Do you also help conduct remote hiring?
As a Digital First company, Mastech Digital has embraced an agile methodology in providing technology talent through our remote IT staffing solutions. Our MAS-REMOTE offering helps you hire IT consultants remotely with confidence, backed by our comprehensive screening and on-boarding process.
Is temporary staffing here to stay?
Faced with uncertainty during the pandemic, a lot of companies now rely on temporary staffing to maintain flexibility and increase or decrease workforce as per demand. That’s why temporary staffing is a significant trend influencing the staffing industry.

If you’ve ever searched for ‘outsourcing’ over the internet, you must’ve come across the terms ‘onshoring,’ ‘offshoring,’ and ‘nearshoring.’ All of them are outsourcing models, and they differentiate from each other based on the geographical location of the outsourcing agency.

Wait, did it get a bit confusing? Don’t worry! Here’s correcting the confusion with a detailed comparison so you can decide what fits best with your business needs. Let’s start with the basics.

What is Offshoring?

Offshoring is when you delegate work to a third-party firm outside your home country.

What is Onshoring?

When you contract part of your work to an organization situated in the same country as yours, it is called onshoring.

What is Nearshoring?

It is called nearshoring when you utilize services from a company situated in a nearby country with a similar time zone as yours.

Offshore Vs. Onshore Vs. Nearshore- A Detailed Comparison

Comparing the three outsourcing strategies based on certain key features can give a clearer picture of what can help you steer towards your business goals fast.

Coordination and Control

  • Offshore– In this method of outsourcing, communication mainly takes place through a virtual medium. Face-to-face interaction is scarce or negligible; thus, having a reliable team of remote workers becomes imperative. It will help if you have an efficient communication system and smart remote work procedures to prevent miscoordination among your team members. Recruiting an offshore staffing agency for offshoring is one of the best methods to make the most out of your offshore strategy.
  • Onshore– Onshoring offers a significant advantage in communication and supervision. Your in-house employees can interact with them regularly and hold in-person meetings and training whenever required. Being in the same country, the vendor’s team is easily accessible. This reduces the chances of miscoordination and thus the turnaround time for projects.
  • Nearshore– The nearshore model falls somewhere between the offshore vs. onshore conflict. Since your nearshore team works from a neighboring country, you have a chance to visit them from time to time, but that depends highly on your commute’s difficulty and distance.

2. Availability of a Diverse Talent Pool

  • Offshore– Offshoring is the winner regarding the diversity of hiring options. One of the major benefits of this model is that you have access to a global talent pool and the opportunity to recruit the best from among them.
  • Onshore– Onshoring offers limited options when looking for and hiring an outsourcing agency. You are limited by geography as you must search only within the borders of your country.
  • Nearshore– Almost like a negotiator in the tussle between offshore and onshore, nearshore outsourcing offers you the freedom to move past the borders, but not too far. So, it provides more choice than onshoring but less than offshoring.

3. Linguistic, Cultural, and Time zone Differences

  • Offshore– Language and cultural barriers are significant in this one as your offshore team resides in a different country or maybe even a different continent. While the time zone difference hampers instant communication, it also serves as an advantage. The latest tech trends in offshoring have helped bridge this gap to a large extent. Alternative shifts of work across borders ensure round-the-clock continuity of business operations. While your team in one continent may be asleep, the other one will be up and working.
  • Onshore– There’s little to no language barrier between you and your onshore team since they reside in the same country as yours. The absence of time zone differences makes instant communication possible, thus enhancing work speeds. Moreover, the cultural difference is also negligible, further improving coordination and understanding between your in-house team and the outsourcing agency.
  • Notice that the stark difference between onshore and offshore regarding language barriers is due to a significant shift in the location in the latter case.
  • Nearshoring– Minimal linguistic and cultural dissimilarities characterize Nearshoring. Because the time zone difference is not that significant, the model offers reasonable convenience of coordination.

4. The Cost Factor

  • Offshore– A highly cost-effective solution that helps companies cut back on huge expenses without compromising on the quality of work. Offshoring destinations like India, the Philippines, Mexico, and likewise offer skilled professionals at considerably lower salaries than the developed nations due to the lesser cost of living and abundance of talent.
  • Onshore– Hiring onshore talent is undoubtedly the most expensive of the three. Domestic talent usually comes at wages higher than what you can find outside.
  • Nearshore– Depends entirely on your country of work. If you’re residing near major offshoring destinations like India, Bulgaria, China, Poland, and others, you can enjoy the benefit of low-cost labor, just like offshore. However, if your neighboring countries offer expensive talent, you might have to rework your budget.

Table: Offshore Vs. Onshore Vs. Nearshore 

Offshore Vs. Onshore Vs. Nearshore- Which is the best? 

Well, there’s no single correct answer to that! Each of them is an excellent method of outsourcing that can help businesses save on expenses and improve business efficiency. The trick to finding the one suitable for you is to take a closer look at your business needs and see which serves them the best. 

For example, onshoring presents a viable solution when you want to execute projects which require prompt communication and need to monitor your team’s progress and performance closely. However, offshoring is your best bet if you’re looking for a cost-effective solution for jobs that do not require much supervision.

To solve such challenges, Mastech Digital offers a hybrid offshore model that combines both benefits and helps you make the most out of offshoring.  

This model helps you factor in all the benefits and risks and evaluate each method’s compatibility with your business goals before making the final decision. Good luck! 

Frequently Asked Questions

What are the typical offshoring destinations?
India is the leading destination for offshoring, followed by China, Malaysia, Indonesia and Brazil.
What are the offshore staffing models offered by Mastech Digital?
With Mastech Digital, you can hire offshore individuals, teams and even associate with us for offshore programs. Our offshore solutions enable us to deliver co-ordinated multi-shift assistance across multiple time zones. Know more: Offshore Staffing | Offshore IT Staffing Services | Mastech Digital.
What is the geographical location in which you offer your services?
Mastech Digital is headquartered in Pittsburgh, PA with offices across the U.S., Canada, Europe, Singapore, and India. We support clients nationally as well as internationally. Please get in touch with us to know more: Best Digital Transformation Services in USA | Mastech Digital.
Do you also help hire employees on a contract basis?
As an IT staffing company, we specialize in providing contingent staff, contract-to-hire, as well as permanent staff across digital technologies.