For the first time, IDC Canada says it has found that more than 50 per cent of the companies it surveyed are outsourcing over 10 per cent of their application and infrastructure support tasks, up from 45 per cent a year ago.

Offshoring, which refers to hiring or contracting people for IT services abroad (as opposed to outsourcing in general, which is also done domestically) is a business worth between $2.5 and $3 billion in Canada, says Mark Schrutt, director of services and enterprise applications at IDC Canada Inc.

It's certainly a strategy that's been proven to give bang for your buck. Offshoring to India is a prime example: a large workforce of highly skilled young IT professionals willing to work at a fraction of the cost of their Canadian counterparts makes it an ideal place to look for bargains.

Offshoring really began to take off in the 1990s, fueled by the demand for large amounts of low-cost resources to do work that wasn't adding any value, says Jason Trussell, senior vice-president and Canadian regional manager at iGATE Inc., a major provider of outsourcing services worldwide. "But once people saw that they could get some of this remediation work done out of India then it transitioned into ongoing development, maintenance," he says.

Trussell estimates that clients of his that outsource development and maintenance jobs to India save an average of 30 to 40 per cent compared to the cost of having these services performed domestically.