IT Outsourcing - Mexico

Mexico

Revenue in the IT Outsourcing market is projected to reach US$5.06bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2028) of 11.78%, resulting in a market volume of US$7.90bn by 2028.
The average Spend per Employee in the IT Outsourcing market is projected to reach US$82.54 in 2024.
In global comparison, most revenue will be generated in the United States (US$185.50bn in 2024).

Key regions: Netherlands, United States, Japan, Germany, Italy

Definition:
The IT Outsourcing market refers to the external contracting of IT functions, services, or projects instead of relying on company-owned resources. By outsourcing IT tasks (e.g., to IT suppliers or software developers), enterprises are able to focus on their core functions and save internal resources and costs (e.g., office space, maintenance, and utilities). Thus, outsourcing teams becomes a viable cost resilience strategy in an environment where companies are looking to save money more than ever.

In an IT context, these activities include IT administration, IT application, and web hosting services. Non-IT-related outsourcing services are excluded.

Structure:

IT Outsourcing contains four distinct markets that are based on different services:

Administration Outsourcing refers to the market for services associated with the external sourcing of typical IT administration tasks such as hardware supply, setup, configuration, maintenance, security, and support.
Application Outsourcing refers to the market for all IT application services in a software production context, spanning from requirement assessments to concept and design of software applications.
Web Hosting includes all types of internet hosting services that allow companies or individuals to provide access to their web page via the World Wide Web.
Other IT Outsourcing refers to aggregated revenues of the types of IT outsourcing that are not specifically mentioned in the other IT Outsourcing markets, such as infrastructure outsourcing, network outsourcing, and managed services.

Additional Information:

The IT Outsourcing market comprises revenues, revenue change, average spend per employee, and revenues of the outsourcing types. Market values represent revenues that are generated by primary vendors either directly or through distribution channels at the manufacturer price level (excluding VAT). Reported market revenues include spending by enterprises (B2B) and governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed. Key players in the market include IBM, Accenture, Capgemini, NTT, and Hewlett Packard Enterprise.

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Market

Region

Region comparison

Currency

Analyst Opinion

Mexico, known for its rich cultural heritage, is also a significant player in the IT Outsourcing market.

Customer preferences: The Mexican IT Outsourcing market is primarily driven by cost savings, access to skilled talent, and the ability to scale operations quickly. Companies from the United States and Canada are the major customers of Mexican IT outsourcing services due to the proximity of the country and the cultural similarities.

Trends in the market: Mexico's IT Outsourcing market has been growing steadily over the past decade, with the country being ranked as the fourth-largest IT outsourcing destination in Latin America. The country's IT outsourcing industry is expected to continue to grow in the coming years, driven by the increasing demand for software development, data analytics, and cloud computing services. The COVID-19 pandemic has also accelerated the adoption of digital technologies, leading to an increased demand for IT outsourcing services in the country.

Local special circumstances: Mexico has a highly skilled workforce, with a large pool of IT professionals and engineers. The country also has a favorable business environment, with the government offering tax incentives and other benefits to attract foreign investment. Additionally, Mexico has a strong cultural affinity with the United States, which has helped to establish strong business ties between the two countries.

Underlying macroeconomic factors: Mexico's IT outsourcing market is closely tied to the performance of the US economy, as the majority of its customers are from the United States. The USMCA (United States-Mexico-Canada Agreement) has also created a favorable environment for trade and investment in the region, which is expected to further boost the growth of the IT outsourcing market in Mexico. Additionally, the Mexican government's focus on developing the country's digital infrastructure and promoting innovation is expected to create new opportunities for IT outsourcing companies in the country.

Methodology

Data coverage:

The data encompasses B2G, B2B, and B2C enterprises. Figures are based on enterprises' technology spending on products, consulting, and outsourcing services.

Modeling approach / Market size:

Market sizes are determined through a combined top-down and bottom-up approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports of key players in the industry, Statista's primary research and surveys, and IT associations. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP, internet users, and telecommunication. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the exponential trend smoothing method is used based on the market data characteristics. The main drivers are the GDP and its sector composition, internet penetration, the level of digitization, and the attitude toward IT security.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.