A depleted supply of qualified information technology workers could stall the recent growth of new technology businesses across the country. That finding in a new survey from PricewaterhouseCoopers does not bode well for the interactive advertising industry.
Nearly 85% of technology industry executives (of 376 top executives of large and small companies interviewed by phone late last year) surveyed cited a lack of available IT professionals as a significant cause of hiring shortfalls at their companies. In fact, two-thirds of all companies surveyed hired fewer than needed IT workers during the past year, said Paul Weaver, chairman of the global technology industry practice for PricewaterhouseCoopers, New York.
COMPETING FOR WORKERS
Companies experiencing shortages include such high-tech organizations as Microsoft Corp. and Dell Computer Corp. Their experiences translate to interactive advertising agencies seeking employees to handle the technical aspects of online marketing.
"The technology workers that are available are going to find it pretty attractive to work for true technology companies," Mr. Weaver said. "If we are seeing that kind of [worker] shortage in technology companies like Dell, my guess is we are going to see that shortage elsewhere."
As the IT worker shortage has prompted Silicon Valley CEOs to lobby Congress for an increase in visas for highly skilled foreigners, interactive ad agencies are facing their own challenge of recruiting technology personnel. Attracting workers with interactive skills in areas such as electronic commerce has been one of the biggest trials for interactive shops.
BASICS PLUS TECHNOLOGY
"Because of the nature of our industry, the technology is evolving so quickly," said Rosemary Haefner, VP-human resources, Agency.com, New York. "We have to look for people with basic skills, plus [knowledge about] some of the brand new technology."
Faced with competition not only from other interactive agencies but also from Web development, data warehousing and other technology companies, agencies are going to universities, the Internet and even their own employees to find new people. They are also offering more exciting work environments and spending more money to bring talent on board.
"To lure these people, you need to provide different incentives than in the past, for example, stock options and higher salaries," Mr. Weaver said. "But there's no short-term solution on the horizon," he said, adding that "1.3 million additional IT workers will be needed over the next three years across industries."
Many agencies are going to the source--universities--to find technology-savvy staff.
"We have gone to universities such as University of Illinois and DePaul University," said Mike DeNunzio, CEO of Chicago-based Four Points
Digital. The interactive agency has hired eight IT personnel in the past year, but still has about five remaining positions to fill. Many graduates Four Points hires have computer science degrees and some have advertising experience, Mr. DeNunzio said.
"[Prospective hires] have to be proficient in a variety of types of programming," he said. "And they have to be folks who really want to work in an agency environment. The work we're doing is creative-based and consumer-centric, and the technology has to facilitate marketing and advertising."
TECHNOLOGY AS CREATIVE TOOL
Several universities offer programs in interactive or new media. New York University, for example, offers an interactive telecommunications program through its Tisch School of the Arts.
"We are focused on how technology can be a creative tool," said George Agudow, administrative director of the program. Students come from a variety of backgrounds, including journalism, architecture, art and computer science. Interactive agencies, along with pharmaceutical companies, financial institutions and even museums, have hired program graduates, Mr. Agudow said. "Our emphasis is on people who want to explore, are creative and see digital tools as a way to reach people."
Additional hiring resources for interactive agencies include Silicon Alley Connections, a New York-based recruiter for the new-media industry, and the New York New Media Association, which posts job openings on its Web site.
Some advertising agencies, such as GSD&M, Austin, Texas, a traditional agency that does interactive work, developed its site, to attract both technology and creative staff.
"We developed our Web site as a recruiting tool because that's where the people we want to hire are going to go for information," said the agency's communications director.
HIRING FOREIGN WORKERS
Other interactive shops, especially those on the West Coast, are hoping to tap into a larger pool of high-tech workers trained abroad. A measure in Congress supported by high-tech industry CEOs would lift a cap on temporary visas for skilled foreign workers. The measure would allow as many as 142,500 more high-tech workers into the U.S. during the next three years.
"Hiring internationally trained people should be looked at as an option," said Mr. Weaver. "It's not [an issue of] bringing in cheap labor that others could do; it's bringing in people to do a job that we don't have resources to do."
Even so, West Coast agencies may have a harder time finding staff. "The environment on the West Coast is different from the East Coast because you are competing with the high-tech companies in the Valley that are looking for technical people," said Quincy Yu, president-chief operating officer, Red Sky Interactive, San Francisco.
Other interactive ad agencies are turning to their own employees. "We get a lot of hires through employee referrals--that's our top source," said Agency.com's Ms. Haefner.
TAPPING CURRENT EMPLOYEES
Some agencies, such as Strategic Interactive Group, the interactive arm of Boston-based Bronner Slossberg Humphrey, offer bonuses to employees who recommend new hires. SIG pays $3,000 per referral for a hire, said Kathy Biro, president.
Internet consultant and Web-site developer Knowledge Strategies, New York, also pays for referrals. "A lot of our employees come from referrals, which is great because it means people like it here enough to bring their friends here to work," said President Cynthia Hollen.
Then interactive agencies face the challenge of keeping the IT workers they've hired. Ultimately, industry executives said, the best draw is exciting projects with top clients and a work environment that cultivates creative expression and innovation.
Agency.com's Ms. Haefner says on-the-job training is provided. "The projects to work on in an interactive agency are cutting-edge. They really allow a technologist to be a creative person."
SIG's Ms. Biro agreed. "We pay very well here and our benefits are really very good, but what really attracts them is the stimulation of the client work."
Interactive agency Rare Medium, New York, has seen little IT staff turnover not only because it offers employees equity in the company, but also because it works only with Fortune 500 companies, said CEO Glenn Meyers.
Still, why would a Massachusetts Institute of Technology graduate opt to work for an interactive ad agency with so many other options available?
"Frankly, new media's sexy," said Red Sky Interactive's Ms. Yu. "It attracts a lot of people from a creative and technical standpoint. How many industries are there in which you can be part of the wave?"
Copyright March 1999, Crain Communications Inc.