Managed IT · July 2026
In-House IT vs MSP: Real Cost Comparison
Should you hire an in-house IT manager or partner with an MSP? Here's the actual cost, capability, and risk comparison for a 25-50 person professional firm.
In-house IT vs MSP: the cost
A mid-level IT engineer in the Bay Area costs $120K-$200K per year fully loaded (salary, benefits, training, equipment). An MSP for a 25-person firm costs roughly $60K-$90K per year and provides access to a full team (help desk, network engineer, security analyst) plus 24/7 monitoring.
Coverage and capability
An in-house IT manager handles whatever they happen to know. An MSP provides specialists across disciplines: Microsoft 365, networking, security, backup, compliance. Most in-house IT managers handle break-fix and forget strategic work because they're underwater.
24/7 monitoring and on-call
In-house IT means vacation, sick days, and after-hours emergencies fall on the same person or get escalated. MSPs provide 24/7 monitoring and on-call coverage by default - and a single in-house person cannot reasonably provide that.
Compliance support
Compliance work (NIST, CMMC, HIPAA, SOC 2, cyber insurance) is specialized. In-house IT typically handles it as a side project with mixed results. MSPs with compliance experience maintain documentation, run gap assessments, and support audits as a core deliverable.
When in-house makes sense
In-house IT is appropriate at 75+ employees with multiple specialized needs, or when the role requires deep physical presence (warehousing, manufacturing, lab equipment). For most professional firms under 75 people, the math and capability favor an MSP partnership.
The hybrid option
Co-managed IT combines a fractional in-house IT manager with MSP support. This gives you strategic leadership and vendor management in-house, with the full MSP team handling monitoring, help desk, and security. Cost is typically $80K-$150K per year - between the two extremes.
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