11 Staffing and Salary Predictions for 2009

Janco Associates released its January 2009 IT Salary Survey. Not surprisingly, the prospects look grim for IT professionals. A perfect storm consisting of recent worldwide economic downturn, company closures, layoffs, cost cutting, outsourcing and retirees who have had to return to the job market because of the lost value of their investment portfolios has created a surplus of IT talent.

Janco Associates has released its January 2009 IT Salary Survey, and the picture it paints is far from pretty. Layoffs, company closures, cost cutting and returning retirees dampen IT salaries and jobs.

“It’s a grim marketplace right now,” said Janco CEO Victor Janulaitis “It’s not going to be that way forever, but it’s going to be very difficult to find a job right now.”

The January 2009 IT salary survey reflects the market conditions of today and a summary of the findings are:

1. Many companies have instituted hiring and spending freezes. This has been augmented by extensive layoffs, outsourcing, bonus reductions and elimination of IT contractors, which has decreased the demand for IT professionals and in some cases lowered wages, with higher priced positions being eliminated.
2. Companies have reduced the benefits provided to IT professionals. Though benefits such as health care are available, IT professionals are now paying a greater portion of that cost.
3. Flexible hours and work schedules are now not as available as they were before the recent economic conditions changed.
4. With outsourcing, lower bonuses, and the recent layoffs there has been a decrease in the mean compensation paid to IT professionals.
5. 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. Added to this is an influx of retirees looking to get back into the job market because of the massive reduction in their savings. There now is a surplus of seasoned IT professionals available.
6. Hiring demand is down for IT executives (especially in midsize enterprises), while proven CIOs are in high demand in large enterprises.
7. The mean compensation for CIOs in large enterprises is now $168,839 (a 6.11 percent decrease) and $163,211 (a 4.97 percent decrease) in midsize enterprises. Much of this is due to the loss or reduction of bonuses and fringe benefits.
8. The mean compensation (which includes bonuses) for all IT executive positions surveyed now is $142,914 (a decrease of 1.20 percent) in large enterprises and $126,021 (a 4.57 percent decrease) in midsize enterprises.
9. The positions in the highest demand are at the staff levels of both large and midisze enterprises with the focus continuing to be line operations and mandated security requirements such as Sarbanes-Oxley, HIPAA and PCI.
10. Outsourcing is placing pressure on computer operations staffs, as those are the positions that are the easiest to outsource.
11. In midisze enterprises, the mean total compensation for all positions has fallen 2.91 percent from $75,814 to $73,607. At the same time, in large enterprises the median compensation has fallen from $82,197 to $81,128.

Janco has captured IT compensation statistics since 1996 and publishes the resultant IT Salary Survey semiannually. IT professionals’ compensation database and compensation benchmark ranges are established for each normalized job position.

In analyzing the study data, the upper and lower quartiles are eliminated to determine benchmark ranges. The benchmark ranges are then used to assess the alignment of a company’s actual compensation to the marketplace for each job function. A summary of the most recent salary survey can be downloaded by visiting http://www.e-janco.com/Salary.htm.

This article was originally published on CIO Update.