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I think a lot of the reason for the inevitable “this is mad”, “Photoshop is faster” comments is the required combination of skills.
Some designers aren’t comfortable with code but like to design for the web, and some front-end developers wouldn’t know a ampersand from their elbow. And then you have all those in between.
If you fall at either end of the spectrum you use PSDs as your communication tool between the ‘designer’ and the ‘code monkey’. And neither of you have to learn the full part of your job.
I’m inclined to say (slightly flippantly) that fear of code could be the reason people cling to Photoshop? Or the inertia of using a tool that feels comfortable and ‘fast’? Mouse as opposed to keyboard? An aversion to learning something new?
I could even suggest that to be a good web designer you do have to know both the pretty and the gritty side of building sites.
If you are good at both, It simply is faster because you don’t need to recode your content, it’s a quantum leap in speed once you’re already working on the final product.
Of course the step Andy Clarke and Meagan have both left out is the fastest prototyping step: sketching on paper, I work out layouts/concepts roughly on paper after establishing the base HTML content then go straight to code.
One thing that can’t be disputed is that if you’re designing in the browser, the need for a crazy expensive image editor disappears, as you can use Pixelmator or Acorn: meaning a much cheaper development environment!