Glen White

As the economy continues to languish, IT salary trends offer little hope to both working and unemployed IT professionals, as companies cut wages and fewer high-tech positions become available due to attrition.

Where the IT jobs are: 10 American cities

Janco Associates today released data from its 2009 Mid Year IT Salary Survey that proves compensation for high-tech workers isn't improving, but declining slightly as more companies prepare themselves for a long economic recovery.

"The current economic climate with its cost-cutting mindsets, business closures and extensive outsourcing has put such a great pressure on the IT job market that overall pay has been impacted," said Victor Janulaitis, CEO of Janco, in a statement. "Added to that, many baby-boomers who had planned on retiring in the next few years are not leaving the job market and you have more potential employees than positions available."

According to the survey of 215 large companies and 526 mid-size organizations, IT salaries fell an average of .19% overall, with midsize enterprise IT executives seeing a nearly 2% decline in total compensation between January 2008 and June 2009. Middle managers at large organizations saw total pay decline by close to .5% as well. The mean compensation, including bonuses, for all IT executive positions surveyed was $142,753 in large enterprises and $123,728 in midsize enterprise companies. Both figures represent a decrease in total compensation on average across some 73 positions surveyed.

"Since the fall of 2008, it has been a very 'poor' period for IT professionals' compensation. Not only has mean compensation decreased due to the lack of bonuses but the supply of IT professionals has exceeded the demand," Janco's report reads.

Not only are companies cutting pay or conducting layoffs, they are also reducing benefits, Janco reports, such as personal and company bonuses.

"Since 2006, there has been a continued reduction in the fringe benefits paid by companies of all sizes. In the case of 401Ks, many companies have stopped providing a contribution to those plans for their employees," according to the report.

Another factor impacting demand for IT professionals is the fact that many high-tech workers are delaying their retirement or re-entering the workforce post retirement.

"There is now a surplus of seasoned IT professionals available. For the second time in less than 10 years, retirements are being put off because of the downturn in the stock market and the resultant reduction in savings available to support IT professionals as they retire," Janco's report reads. "Added to this is an influx of retirees looking to get back into the job market due to the massive reduction in their investment portfolio."

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As the automobile industry sheds jobs, it comes as good news that over the last decade or so the Internet has created 1.2 million jobs, many paying higher salaries than average, a new study finds.

Internet business contributes 2.1%, or $300 billion, to the total GDP (gross domestic product) of the U.S. And IT and related online business may be faring better in this recession than they did in the dotcom bubble of 2000-2002, still growing revenue but at slower pace.

Consumers are now making 10% of their retail purchases online, with the exception of groceries, on the Internet, and Internet-based advertising has increased four-fold since 2002 to more than $20 billion, said John Deighton, a professor of business administration at Harvard Business School, and one of the authors of the study along with Hamilton Consultants Inc.

The study, considered independent, attempts to measure the so-called Internet economy. It was prepared for the Internet Advertising Bureau (IAB) in New York, which represents a variety of Internet and media companies.

It does not raise policy implications, but IAB officials said the data will help them make the case for self-regulation on issues such as privacy. Randall Rothenberg, president and CEO of IAB, said the report is the "first rigorous, comprehensive look at the size scope and impact of the interactive advertising ecosystem."

Deighton said the finding could help make the case for a move away from employer-based health care, which he called something out of the Middle Ages, to a system that makes it easier for people to start new businesses without having to provide health coverage.

The study's job estimate is based on people who work directly in building or maintaining the Internet's infrastructure, conduct advertising and commerce over it, and other direct uses. The number of indirect jobs supported by Internet-related activities may raise the total number of jobs by 1.54 million, or to slightly more than 3 million supported jobs.

E-commerce companies, as well as those that deliver the physical goods, were the major employers, with more than 500,000 of the 1.2 million jobs. Internet service providers followed at 181,000. Content-related employment was estimated at nearly 60,000, and software as a service, 31,500.

John Yaglenski, who runs the independent Walt Disney World travel information site Intercot.com, along with 35 volunteers, was at the announcement today and said that that regulation that imposes new requirements and restricts information collection could have a serious impact.

Yaglenski said he has privacy policies clearly outlined on his site and believes the industry is capable of regulating itself. "If the government steps in and regulates the industry to the degree that it has done in some other areas it could really affect our livelihood," he said.

Taiwan Semiconductor Manufacturing (TSMC) reported higher than expected sales for the first three months of the year on Friday, due in part to chip orders tied to part of China's economic stimulus plan aimed at building 3G networks across the nation.

The world's largest contract chip maker, considered a bellwether for the technology industry due to the wide range of products the chips it makes go into, posted sales of NT$39.5 billion (US$1.17 billion) in the first quarter.

The figure beat the high end of its guidance, which was NT$38 billion, but was still down 54.8 percent from the NT$87.48 billion it reported at the same time last year.

Stronger sales at TSMC came as little surprise to analysts because a number of other chip makers, many of them TSMC's customers, had raised their first quarter guidance due to stronger demand from China, including Texas Instruments, Altera and Xilinx of the U.S. and MediaTek of Taiwan.

TSMC manufactures chips designed by most of these companies.

The construction of China's 3G network is a priority alongside the government's 4 trillion Chinese yuan (US$585 billion) economic stimulus package. Beijing handed out 3G licenses to three companies last year, China Mobile, China Telecom and China Unicom.

China is the world's largest mobile phone market in the world, with over 641 million subscribers at the end of last year.

Stronger chip orders prompted TSMC to end unpaid leave for employees at the beginning of April. But the chip maker cautioned at the time that the economic fundamentals had not significantly improved and said it would continue to control costs.

TSMC did not comment on its first quarter sales figures Friday.

The company reported its monthly sales for March on Friday, and added up the first three months of the year to provide the first quarter figure. TSMC's formal first quarter investors' conference will not take place until the end of this month, according to its Web site.