Is managed IT cheaper than hiring?

Below about 100 employees, usually, once you count salary, benefits, training, tooling and the cost of the weeks when that person is unavailable. Above it, the comparison narrows and eventually reverses. We scope from an audit rather than a headcount, so the honest answer for your business comes from the numbers rather than a rule.

Can we start with managed IT and hire later?

Yes, and it is a sensible sequence. Bringing IT in-house is far easier when there is documentation, an asset register and a working baseline to hand over, which is what a managed contract produces as a by-product.

What happens to our existing IT person?

In most co-managed engagements they stay and their job gets better, because the queue stops consuming their week and they can do the projects they were hired for. We are explicit about that at the start, because an internal person who thinks you are replacing them will not cooperate with the handover.

Decision guide

Managed IT vs an in-house IT team

Below roughly 100 employees, managed IT almost always wins, because one internal hire cannot cover the range of skills a modern estate needs and cannot be on call every night. Between 100 and 250 a co-managed model usually wins. Above that, an internal team with external specialists is normally the right shape. Those are rules of thumb, not laws, and the exceptions are worth understanding.

Talk it through with an engineer See the comparison

What is actually being compared

In-house IT: One or more employees whose job is your technology. Present, invested, and available during their working hours.
Managed IT: An external team running your estate under contract, with a defined response time and a documented process.
Co-managed: Your internal person owns priorities and relationships; the external team provides depth, cover and escalation.

Side by side

How they differ in practice

Feature	Feature	In-house IT	Managed IT
Skill coverage	What one or two people happen to know	Networking, security, Microsoft 365, cloud and hardware specialists	Internal knowledge plus external depth
Out of hours	Goodwill, until it runs out	Contracted cover for critical issues	Contracted cover, internal escalation
Holiday and illness	Nobody, or a scramble	No change, the team continues	No change
Resignation risk	Knowledge leaves with the person	Documentation stays with the account	Reduced, documentation is maintained
Business context	Strong, they know your people	Weaker initially, improves with the relationship	Strong, internal person holds it
Cost shape	Salary, benefits, training, tools	Fixed monthly contract	Salary plus a smaller contract
Speed on trivial requests	Immediate, they are in the room	Fast, but through a queue	Immediate for local, queued for specialist
Documentation	Rarely maintained, no time	Contractual, maintained continuously	Maintained by the external side

Choose in-house if

Your business has an unusual technical stack that no external provider will realistically learn well, such as a bespoke platform your operations genuinely depend on.
You need somebody physically present all day every day, which is common in manufacturing and some healthcare settings.
You are large enough that the person will have a full week of meaningful work, and you can afford a second person so holidays do not create an outage.

Choose managed IT if

You are under about 100 people and your current arrangement is whoever is most technical doing it alongside their real job.
You need cover outside office hours and cannot justify a rota.
You have compliance or customer obligations that need evidence, and nobody internally has time to maintain the documentation.
Your last IT person left and took the knowledge with them, which is the single most common reason we get called.

Choose co-managed if

You already have somebody good internally who is drowning in tickets and cannot get to projects.
You have grown past 100 people and the internal person is now a single point of failure.
You want internal ownership of priorities and relationships but need specialist depth for security, Microsoft 365 or cloud.

When the other option is right

If your requirement is somebody in the building at all times, managed IT is not the answer and we will say so. We are also the wrong choice if the value you want is deep knowledge of a proprietary application that only your team understands. In both cases hire internally, and consider a smaller external contract for the specialist areas your hire will not cover.

Whichever way you go, do these first

Build an asset register before anything else. Age, warranty and assigned user per device. Every option gets cheaper to evaluate once you know what you own, and neither a hire nor a contract can be scoped properly without it.
Count what IT currently costs you, honestly. Not just salaries and licences: include the hours non-IT people spend fixing things, and the days lost when something broke and nobody was available.
Write down what actually stops the business. Not what would be annoying, what would stop revenue. That list determines the response time you need to buy, and it is usually shorter than people expect.
If you are hiring, plan for cover. One person means holidays and illness are outages. Either budget for two or budget for external cover alongside the hire.
If you are contracting, insist on a site audit before the quote. A price given without one is either padded or about to change.

Questions

Common questions

Talk it through with an engineer, not a salesperson

Tell us your situation and we will tell you which option fits, including when that is not us. Initial reply within 4 business hours.

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