Government outsourcing of services to private sector entities is increasingly common. The conventional wisdom ties governments' outsourcing decisions to either an ideological preference for market-based solutions or fiscal pressures. However, these conjectures have not been systematically subjected to empirical scrutiny. I develop an aggregate annual measure of US state-level outsourcing decisions-macro outsourcing-and explore whether the evidence supports these pathways. I also point to an underappreciated political pathway by which potential losers-bureaucrats organized into public sector unions-affect the decision to outsource. The results offer little support for the received wisdom and instead demonstrate that states with strong unions are less likely to rely on private actors. I bolster this finding with preliminary analyses showing that states with laws that sap union power exhibit higher levels of outsourcing. Overall, these results show that outsourcing is a decidedly political phenomenon, albeit via an unexpected route.