As the earnings season knocks again on the doors of IT companies, workers are worried about the possible U.S. recession and the comparatively low profit margins affecting their salaries and jobs.

Interestingly, all bad news is not always bad, analysts believe. Several research findings in January this year show that there is a positive outlook in 2008 for the services industry, despite gloomy economic forecasts. 

According to a research by the Association of Technology Staffing Companies (ATSCo) and recruitment specialist SkillsMarket, there is no evidence of IT jobs being shed. “IT departments are not as over-staffed as they were in 2001 to 2002 in terms of IT skills, so there is far less fat to trim this time around. In fact, there is a strong demand for IT skills in areas such as equities and commodities, and trading in investment banks, which is helping to pick up some of the slack on the credit side,” commented Ann Swain, Chief Executive, ATSCo.

As a matter of fact, the IT contractors can remain optimistic for 2008 as demand for them may actually receive a further boost if the economic outlook remains uncertain. “There is often an upswing in demand for temporary workers during challenging economic conditions as organizations put off hiring permanent staff,” said Matthew Brown, Managing Director, Giant group.

A recent research carried out by Giant shows that fewer temporary workers are spending three months or more, without work compared to a year ago. Long-term joblessness amongst these workers fell from 4.7 percent at the end of 2006 to 4.4 percent at the close of 2007, its lowest level for nearly two years.
The research also suggested that job security has emerged among the least of concerns of the temporary tech workers, suggesting that fears of a business and economic slowdown leaves the majority unfazed. 54 percent of contractors would prefer higher pay to a longer contract, compared to 49 percent this time last year.

However, the credit crunch may have an adverse effect upon the salaries of IT workers as businesses tighten their purse strings. And that is why about 54 percent of contractors, surveyed, prefer higher rates to lengthy contracts, an increase of 5 percent from last year. The pessimism over pay was also demonstrated by a 4 percent reduction in those contractors who thought their income would rise this year, down from 76 per cent in 2007.

In view of all these findings, the conclusion is that the economic turmoil is more a boon than a curse for technology workers.