Why MSPs are Replacing Hiring with Offshore Engineers?

How growing MSPs scale their technical teams without increasing payroll pressure?

For many Managed Service Providers (MSPs), growth comes with a challenge: hiring. Winning new clients and large accounts is one thing, but delivering consistent high-quality service at scale is another. As MSPs grow, the demand for skilled engineers increases rapidly, but hiring just can’t keep up with growth.

Recruitment cycles stretch longer, salary expectations rise, and experienced engineers become harder to source in competitive labour markets. As a result, growth starts to create operational friction instead of momentum. To battle this, many MSPs are now rethinking how they build their technical teams, exploring alternative ways to scale without being stifled by local recruitment timelines and payroll pressures.

One of the most effective models emerging in the industry is the use of highly skilled offshore engineers integrated directly into an MSP’s delivery team, working in tandem as team members and not outsourced vendors.

The MSP Hiring Problem

Across the industry, MSPs are facing the same pressures:

1. Experienced engineers are hard to find.
   The pool of candidates available in competitive markets like the UK, AU, US, with hands-on MSP experience across ticketing systems, RMM tools, network infrastructure, cloud platforms, and security operations is relatively small. Competition for securing engineering talent of that calibre is fierce with large organizations ready to offer packages a growing MSP simply can’t match.
   
   
2. Recruitment can take 3-6 months.
   Even if the perfect candidate did exist, recruitment cycles could take anywhere between three to six months. For a growing MSP that translates to three to six months of strained capacity, burnout risks in the existing team, and the constant risk of service quality slipping.
   
   
3. Salary expectations continue to rise.

   According to Randstad, the highest paying jobs in the UK for 2026 are concentrated in sectors where technical expertise is very hard to find and expensive, i.e. cloud engineering, cybersecurity, and data science. 2026 projections in the UK indicate a 3-3.5% increase in compensation budgets.

4. Staff turnover disrupts delivery.
   The IT services sector experiences an average annual turnover rate significantly higher than the average across all industries. Reasons for this can range from unsatisfactory pay, high demand from larger organizations, burnout, lack of career path, and more.
   
   
5. Growth creates constant hiring pressure.
   For an MSP trying to scale, hiring creates a very real bottleneck. New clients require onboarding, existing clients require consistent support without a dip in quality/responsiveness. Projects need to be delivered on time and without enough engineers, service quality and team morale can quickly deteriorate, potentially threatening growth.

The Hidden Cost of Hiring

Hiring for MSPs isn’t just about salary. That’s just one item on the list of costs attributed to bringing on an experienced engineer. In reality there are recruitment fees to consider which can run up to 15-30%, with standard roles typically falling between 15-20% of the first year’s salary, when working with recruitment agencies and headhunters. For specialist, senior, or hard-to-fill roles, fees often range from 20% to 30% or more in the UK.

One has to consider training and onboarding time for each new hire, which can tie up existing senior engineers for weeks. There’s also the ongoing management overhead of integrating someone new into the team.

Add in employer contributions, benefits, and other employment-related costs, and the true annual cost of a mid-level engineer in the UK can easily range between £60,000 to over £85,000, with more senior roles demanding higher pay based on experience and location. And that’s assuming the hire works out. There’s always the added risk of hiring in-house talent because a poor hiring decision doesn’t just cost money. It costs team confidence, time, and sometimes even client relationships.

During this recruiting timeline, the backlog only keeps growing as the role remains unfilled.

The Offshore Engineering Model

Traditional hiring assumes a predictable and steady growth curve, but MSP growth isn’t always linear. It tends to be driven by bursts of demands that hiring can’t match in real time, such as:

• New client wins
• Project spikes
• Seasonal demand
• Expanding service offerings

Taking costs and hiring cycles into account, by the time a new engineer is onboarded and ready to go the demand may have shifted and new gaps may have surfaced. That’s why many MSPs today are moving away from traditional hire-as-you-grow to a more flexible approach: integrating offshore engineers directly into their teams.

They work as dedicated, embedded members of the MSP’s team, aligned to the tools, processes, escalations, and service standards. Offshore engineers can support a wide range of technical functions across an MSP’s delivery services, including:

• Service Desk
• NOC Operations
• Infrastructure Support
• Cloud Engineering
• Security Operations
• Automation and Tooling (to reduce ticket volume over time)

The key difference between traditional hiring and offshoring is that the talent is sourced globally. This means MSPs now have access to a much deeper, highly skilled technical talent pool, without being limited to local recruitment supply, compensation expectations and timelines.

Benefits for MSPs

MSPs hiring offshore engineers are seeing clear operational advantages:

1. Faster team scaling.
   Unlike local hiring that could take three to six months, offshore engineers can be sourced, vetted, hired, onboarded, and live within 45 days (or less)!
   
   
2. Access to talent.
   By removing the constraints of local hiring, MSPs can tap into a much larger pool of skilled professionals. This is especially useful when trying to source highly specialized roles like security analysts, automation engineers and cloud engineers.
   
   
3. Lower payroll costs.
   Offshore engineers reduce overall employment costs compared to their local equivalents, without a drop in technical quality and capability. This becomes an MSP’s competitive advantage, allowing them to scale teams faster, improve margins, and reinvest into growth.
   
   
4. Reduced hiring risk.
   The traditional hiring risk of investing months and money into a candidate who then underperforms and/or leaves is eliminated when working with a offshore talent provider that is accountable for vetting, training, matching engineers across MSP operations.
   
   
5. More predictable growth.
   When capacity scales alongside demand, operational friction is eliminated. MSPs can maintain or even improve service quality while onboarding more clients.