Workforce, E-Commerce

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The e-commerce workforce is a large, indistinct mass of working people that overlaps and blends gradually into other sectors of the economy, such as information technology, manufacturing, and retail. As the 21st century began, the Bureau of Labor Statistics, the Census Bureau, and other government agencies were taking the first halting steps to track the size and extent of the American e-commerce workforce. Part of the problem is definitionwhat is it? Does it consist only of workers at the so-called "dot-coms"firms that derive 95 percent or more of their revenues from business on the World Wide Web but that, according to a study by the Center for Research in Electronic Commerce (CREC), make up a mere 9.6 percent of the Internet economy? Or should it include workers at any companies that produce anything for the Internet, that do any business online, or that have any Web presence? The government lumps e-commerce workers in with the Information Technology (IT) sector, which includes manufacturers of computers, computer parts, software, and components; software and applications developers; database managers; hardware and software engineers; as well as the Internet, but tracks only "core IT" workers, namely computer scientists and engineers, systems analysts, and computer programmers. But what about people who design the marketing campaigns, write the Web site content and pack the boxes at ? The waters are murky indeed.

According to a 2001 study done by the CREC at the University of Texas, in mid-2000 the Internet economy supported 3.08 million workers, a number larger than the insurance (2.36 million) or real estate (1.5 million) industries. The CREC further broke down the Internet economy into four constituent sectors: an infrastructure sector which employed 932,484; an application sector which employed 740,673; an intermediary sector which employed 468,689; and, an Internet commerce sector which employed a workforce of over 1.03 million. In 2000 s employed about 360,718.

Despite Census Bureau metrics, e-commerce is more than IT jobs. According to the Web site Internet Economy Indicators, the highest percentage in 2000 of workers in e-commerce were in sales and marketing, who comprised 33 percent of the total e-commerce workforce. IT workers made up only 28 percent. Operations and manufacturing accounted for 17 percent; accounting and finance for 12 percent; and administration, executives, and others for 10 percent of e-commerce workers. The surveys of the Association of Internet Professionals' membership provide a partial breakdown of typical job titles in e-business. They include graphic designers, art directors, copywriters, Web designers, Web production and coding specialists, project managers, content developers, systems administrators, multimedia specialists, technical support, network engineers, database designers, and database administrators. To these mostly Web-specific jobs can be added customer service people, warehouse clerks, shipping and receiving help, accountants, human services departments, and virtually every other job title found in modern retail and corporate life.

Salaries in the Web economy vary by job, size of the firm and location. In late 2000 an Industry Standard survey reported that the average annual salary of Internet workers was $85,000, $54,000 more than the private industry average. Those Internet workers put in 10 hour days on the average, along with one weekend a month. According to the same survey, the median salary of a CEO in a Web firm was $204,000 plus additional bonuses and cash compensation. In contrast, the typical Internet desk jockey earned about $50,000, sometimes with stock options. According to the Industry Standard, however, most rank-and-file Internet workers considered the size of their salaries far more important than any stock option plan. According to the government's Digital Economy 2000, a webmaster in California earned an average salary of $59,600, while her counterpart in New England earned an average of only $43,800. A company with more than $500 billion in annual revenues paid a web-master $58,600, more than $10,000 more than a company with less than $100 billion in revenues.

The Internet workforce grew rapidly through much of 2000. During the first half of the year, it added 612,375 new workers, almost as much as entered the industry in all of 1999. Employment in the Web economy grew at a remarkably faster pace during this period than in the economy as a whole. It increased by 29 percent between the first quarter of 1999 and the first quarter of 2000, compared to a meager 6.9 percent for non-Internet workers. As late as October 2000, companies were complaining of a serious shortage in skilled e-commerce help. However, the layoffs that accompanied the crash were already underway. Between June 2000 and April 2001, according to CREC statistics, some 93,979 Internet workers lost their jobs, about 3 percent of the whole Web economy. They continued through the first half of 2001. It was not as bad as it at first seemed it might be. s announced 87,795 layoffs; less than half that number actually lost their jobs, howeverabout 41,000 between were put out of work between October 2000 and July 2001.

The bust had immediate repercussions on work-ersat least in the sector. Salaries flattened out, and frequent raises and benefits like flex hours and casual workplace all but disappeared. In late 2001, laid-off workers were facing long job searches and to compromising their demands for salaries and perks. Union organizers found Internet workers, at for example, more open to their arguments. On the other hand, many laid-off dot.commers could boast of levels of management experience that others needed years at a traditional companies to acquire.


Mahoney, Michael. "Dot-Com Job Cuts Fall to 12-Month Low." E-Commerce Times, August 29, 2001.

. "E-Commerce Layoffs: Storm on the Tech Frontier." E-Commerce Times, May 08, 2001.

"PwC Report Rates Best Recruiting & Retention Practices." Report on Salary Surveys, October 2000.

Regan, Keith. "For Dot-Com Workers, Double Trouble Post-Bubble." E-Commerce Times, August 24, 2001.

Said, Carolyn. "Dot-Com Disasters Have Opened Door a Crack for Unions." San Francisco Chronicle, December 3, 2000.

U.S. Department of Labor. Digital Economy 2000. Washington, D.C.: GPO, June 2000.

SEE ALSO: Talent, Recruiting and Retaining