Is it cheaper to hire someone for IT or to outsource it?

For most businesses of 5 to 60 people, outsourcing is cheaper, and the gap is bigger than it looks on the salary line.

What does one IT person actually cost?

Take £32,000, which is roughly where IT support technician adverts sit around South Wales. I am using it as a worked example rather than quoting it as a statistic.

• Salary: £32,000
• Employer National Insurance at 15% on earnings above the £5,000 secondary threshold: about £4,050
• Pension at the 3% auto enrolment minimum, on earnings above £6,240: about £770

So roughly £37,000 before that person has done anything, and before you have bought them a laptop.

And that is just the person

£37,000 buys you somebody with nothing to work with. An IT person on their own cannot look after twenty people with their bare hands. They need tools, and every one of those tools is a licence you pay for on top of the salary.

For twenty users, the list looks something like this:

• Remote monitoring and management, to patch, monitor and fix machines without walking to them
• Endpoint protection, and somebody watching it around the clock, because software that raises an alert at 2am nobody reads is doing half the job
• Email security on top of what Microsoft gives you
• DMARC so nobody can send email pretending to be you
• Vulnerability scanning. Tenable lists Nessus Professional, the scanner most IT people have heard of, at $4,790 a year on its own
• A password manager. 1Password Business lists at $8.99 per user per month, so about $2,150 a year for twenty people
• Backup of Microsoft 365 email and files
• Email signature management, DNS filtering and the rest

Those two list prices alone come to nearly $7,000 a year, and that is before the monitoring, the email security, the backup or anything else on the list. None of it is optional if you want the business properly protected, and you pay for all of it whether you employ somebody or not.

Then the things that do not appear on a salary slip or a licence. Recruitment, which is either a fee or a fortnight of your own time. Kit. Training and certifications, because a technician who stops learning becomes a liability in about three years.

Twenty users on our Secure level is £55 each per month, so £13,200 a year, and every tool on that list is inside it. That is on the pricing page along with what sits at each level.

But the person is there all day

They are, and that is genuinely worth something. It is also the weakness of the arrangement rather than the strength.

One person is one person. They take holiday. They get flu. They have a dentist appointment on the morning your email stops. When they hand in their notice, everything they knew about your setup walks out with them, usually undocumented, and you start again with a stranger who has to learn it all from your staff.

One person also has one set of experience. Nobody is good at Microsoft 365, firewalls, phone systems, backup, security monitoring and the thing your accounts package does on the last Friday of the month. They will be good at some of it and be looking things up for the rest, on your time.

And nobody is watching at 11pm. Attacks do not keep office hours, and the whole point of a managed detection service is that when something happens at two in the morning, a human being sees it.

Where hiring genuinely wins

I am not going to pretend it never does.

If you have a bespoke line of business system that somebody needs to be inside every day, an internal person is worth their salary and then some. If your business has grown past about sixty people and IT has become a full time job with a queue behind it, that changes too. If you have compliance obligations that require somebody accountable in the building, that is a real argument.

At that point most businesses split the work. Your person owns the business specific work and the relationships. We own the tools, the security, the out of hours and the depth. That is the co managed arrangement, and it is on the pricing page deliberately without a number against it, because it is a different conversation each time.

The comparison nobody makes properly

If you do compare the two, compare like for like. The honest version of the in house column includes:

• Salary, employer NI and pension
• Recruitment and the time it takes you
• Their laptop, phone and desk
• Training and certification budget
• Every tool licence you would otherwise be getting bundled
• Cover for holiday, sickness and the notice period
• What happens when they leave

Against a monthly fee where all of it is included and predictable, and where nobody is ever the only person who knows.

What I would actually tell you

If you are under about sixty people and your IT lives in Microsoft 365, hiring somebody is usually the more expensive way to end up with less resilience. That is arithmetic plus the holiday rota.

If you are over that, or your IT is genuinely unusual, come and talk about the split rather than the swap.

I would rather tell you the honest answer than sell you the wrong shape of thing. I own this business, so I care more about whether you are still a client in three years than about this month. Sometimes that means telling somebody to spend less than they were ready to, and occasionally it means telling them we are not the right answer at all.

Tell us how many people you have and roughly what you are running, and you will get a straight comparison for your business rather than a general one. What is covered day to day is set out in full, and so is what it costs.