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July 5, 1999

Labor Intensive

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At one point, about 1,200 of the 5,000 full-time and contract workers in GTE Corp.'s IT department were devoted to the company's Y2K initiative. Now, fewer than 150 people are needed, says Dan Grim, GTE's director of human resources. "We knew our Y2K project would span a number of years, so we tried to hire people who had skills we knew we would be able to make use of afterward."

Don Harris, manager of staff development at Belk Department Stores in Charlotte, N.C., also has redeployed Y2K resources, including 40 contractors he's used for the past year. Moreover, as other companies finish Y2K projects, Harris has been receiving more queries from prospective IT employees in recent months.

To handle immediate needs, IT managers are relying more than ever on service contractors and temporary IT workers. Just over half of the managers responding to the InformationWeek survey say they're hiring temporary or hourly IT workers. United HealthCare's LeFort says 5% to 10% of his IT staff is composed of temporary workers, and he's outsourced about 60 positions to an offshore group in Ireland.

"We've gone to contractors a lot because it's easier for us to get projects completed," says Thad Kucaynski, a technical associate in the IT department at Utilities International in Chicago, which develops software tools for the utilities industry. People with specialized skills, such as programmers who understand the utilities business, are hardest to find, he says. And though contractors get the work done, they also add an average of 15% to the cost of Kucaynski's projects.

Dan Grim Photo by Steve McAlister In a competitive environment, the well that supplies contractors is running dry, too. Romac International Inc., a $680 million company in Minneapolis that provides temporary, contract, and permanent professional and technical personnel, hasturned down requests to supply contract workers since the beginning of this year because it didn't have the IT professionals to fill the jobs.

The company has about 50 openings for full-time IT contracting professionals. "Having a labor shortage forces you to work harder to find, get, and retain good people," says Bob Anderson, business unit director at Romac. "IT professionals are constantly getting counter-offers, so it's important for us to make sure they're happy here."

Bonuses help, but to beef up its IT staff even more, Romac is training non-IT people in areas such as help desk for Windows NT and Office. In the last year, Anderson has hired about 12 people who had customer-service skills but no IT experience and trained them to work as help-desk professionals. So far, the recruits are working out well, and clients want to bring them on board as their help-desk contractors, Anderson says.

In response to the computer industry's huge labor demands, the government last year approved an increase in the use of foreign workers for some IT jobs. However, all 115,000 of the visas allocated this year for foreign IT workers through the government's H-1B visa program were issued by mid-June.

The Department of Commerce, however, doesn't believe going outside the country for talent is a viable long-term solution. "The [Clinton] administration is not in favor of further increasing the caps because we believe the critical issue is ensuring that we have adequate numbers of highly skilled Americans to fuel the economy and capture these highly competitive positions," says Kelly Carnes, Commerce Department assistant secretary designate. Carnes favors efforts by private companies to extend the IT workforce, such as Baltimore Gas and Electric's active participation with schools to promote IT education.

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