InformationWeek: The Business Value of Technology

Nonprofit health-care organization Sutter Health says the economy hasn't slowed its plans to bring on more IT people, but it's wary of new graduates, says Keith Vencel, product managers, employment, for the Sacramento, Calif., company. Sutter, which had 55 IT positions open at the beginning of the year, still has 12 vacancies, ranging from desktop support to network security.

That doesn't mean that the company, which fills a lot of its openings through referral programs, has many positions open for college grads. "We want people with experience somewhere," Vencel says. "The foundation isn't as strong with people right out of college." He has hired three recent grads, and acknowledges that the class of 2001 is better prepared than preceding generations because students are likely to have solid backgrounds in business and technology.

Regardless of hiring plans, the surplus of IT talent from layoffs and failed dot-coms has created a recruiter's market. IT organizations can attract experienced people who wouldn't have given them a second glance last year--and can bring them aboard at lower salaries.

One New York animation and design startup recently laid off HTML programmers earning $80,000 a year because it could now pick up programmers with similar experience for $60,000. "It's definitely more competitive for IT jobs than it was last year because our students are competing with displaced employees," says Jamie King, head of career services at the University of Texas at Austin.

Abhi Sindhwani, who's graduating from Ohio State University's undergrad IS program, was told by a Columbus, Ohio, software developer that it was no longer hiring entry-level IT workers. When Sindhwani, who has interned for a number of midsize IT firms, asked why it should exclude him, the recruiting manager confided she could get a newly laid-off worker with two years experience for the same price. That strategy is affecting not only permanent positions but also the internships that MBAs and IS majors depend on for summer income and as career stepping stones. Even internships may not lead to permanent jobs anymore, as Rosi and other recent grads are finding out (see story, "Getting Value From Your IT Interns").

PricewaterhouseCoopers' Hamlet says it still has 60 undergraduate interns and 40 MBA interns. But some companies missed the chance to hire interns instead of long-term employees for high salaries. "A lot of the local firms were unable to forecast their needs for summer interns and are now realizing that having a hired gun for 10 to 12 weeks is a good idea," says Austin Power CEO Trominski. Some interns are working for less pay than in previous years, and many of the open internships are unpaid, she says. In previous years, internships, particularly on the MBA level, were almost never unpaid

Job qualifications also vary in this confused market where unemployment is low and supply is high. For example, King says that businesses want well-rounded candidates with a grasp of technology and business skills and knowledge of financial matters. "When the economy turns down, they want to try to find people who can tell them how to make more money with what they've already got," she says.

PricewaterhouseCoopers, on the other hand, is turning away from MBAs, who used to make up much of its new hires, in favor of candidates with strong computer science and IS backgrounds. That reflects a companywide philosophy change as much as the economic downturn, Hamlet says. While the company doesn't expect expertise in specific IT areas such as customer relationship-management or enterprise resource planning, it typically looks for people with basic technology skills in Java and C++.

Sutter Health would love to have grads with prior business experience in health care but is settling for candidates with technology skills, such as general IT knowledge about servers and desktops or programming languages and firewall expertise.

One thing that remains constant is that recruiters are looking for candidates with as much experience as possible. This means that life could get tough for students who went straight through school without taking time for internships or to learn practical skills. Brigham Young University undergrad Collin Sloan, who just earned a degree in MIS, says he hears about internships repeatedly at job interviews. "The trouble I'm running into is that there are tons of jobs out there, but they need people with experience."

Sloan's chosen field, Web development, isn't known for requiring a lot of experience, and he has all the basics--but most companies now are asking for more. He's amassing some of that experience with an internship at Novell, a neighbor of the Provo, Utah, university. Sloan would like the internship to turn into something permanent, but a companywide hiring freeze has kept that from happening.