Outsourcing vs. Hiring U.S. Workers: A Cost Comparison
In today’s business world, controlling costs while maintaining quality is essential. One effective strategy is outsourcing, particularly in countries like the Philippines. But how does outsourcing stack up against hiring U.S. workers in terms of cost? Let’s take a look.
The High Costs of Hiring U.S. Workers
Hiring in the U.S. involves more than just salaries. You also need to account for:
Employee Benefits: Health insurance, retirement plans, and other benefits can add about 30% to an employee's total compensation.
Payroll Taxes: Employers must cover federal and state taxes like Social Security and Medicare.
Overhead Costs: Office space, equipment, and utilities are all necessary to support employees.
Compliance Costs: Navigating U.S. labor laws adds extra costs.
These factors can easily push the annual cost of a U.S. worker above $70,000, even for entry-level roles.
The Cost Advantages of Outsourcing
Outsourcing to the Philippines can significantly reduce these expenses:
Lower Wages: The cost of living in the Philippines is much lower, so wages are also lower.
Reduced Benefits Costs: Benefits and taxes are typically included in the outsourcing fee, reducing your burden.
Minimal Overhead: Outsourcing providers like MSA Outsourcing cover the costs of infrastructure and equipment.
No U.S. Payroll Taxes: Since the employees are based abroad, U.S. payroll taxes do not apply.
For example, while a U.S. Customer Support Representative might cost you over $66,000 annually, outsourcing the same role to the Philippines could cost as little as $12,000-$15,000, saving you more than 75%.
More Than Just Cost Savings
Outsourcing presents a compelling cost advantage over hiring U.S. workers, along with strategic benefits that can help your business grow. MSA Outsourcing can help you tap into these benefits, providing skilled workers at a fraction of the cost.
For more details, visit MSA Outsourcing or contact us today. Let's work together to optimize your business.
