Business

NOT ALL BAD NEWS

Yes, there are tech layoffs. But a lot of people are being snapped up by other companies

Katherine Macklem June 25 2001
Business

NOT ALL BAD NEWS

Yes, there are tech layoffs. But a lot of people are being snapped up by other companies

Katherine Macklem June 25 2001

NOT ALL BAD NEWS

Yes, there are tech layoffs. But a lot of people are being snapped up by other companies

Business

Katherine Macklem

Hiyab Beyene, a recruiter with a Montreal-based technology firm, is looking for what he calls "disturbables." He wants to hire peopie who can work with "high-octane, cutting-edge multimedia technology" for a new research and development centre, and he

says the recent rash of layoffs in the tech industry has been a boon. Not, mind you, for the tens of thousands who are out looking for work. Rather, he’s after people who are still employed—and oddly, todays climate of cutbacks helps him pry them loose from their posts. “Layoffs create a sense of uneasiness, uncertainty, instability—even for those candidates who retain their jobs,” Beyene says. “They become much more disturbable.”

Over the past year, the information technology industry has been beset with bad news: dot-coms have dropped out of business, sturdier companies have lowered earnings expectations, and thousands have been laid off. Just last week, Nortel Networks Corp. cut 10,000 more jobs in addition to the 20,000 it had already slashed across its worldwide operations. But just as the hiring plans of BiblioMondo Canada Inc., the electronic-library company Beyene works for, run counter to the wider trends, the badnews headlines mask the subtleties of an industry with many markets and many sectors. For instance, Calgary is hot, says Kevin Dee, who runs Eagle Professional Resources Inc., a tech recruiting firm with offices across Canada. Ottawa is not, says Carol Ann MacDonell of Proxenia Resourcing Inc. At least not in the

all-important technology products side of the business, adds MacDonell, a recruiter focused exclusively on the capital’s high-tech market. Toronto-based Elan Pratzer, who seeks out high-end executives as managing director of Canada for Korn/Ferry International, says there is strong demand for top-notch leadership candidates. And Beyene—himself a recent hire—is actively looking for Web developers, software architects and product specialists for BiblioMondo, a company in full expansion mode.

Over the past two months, since he joined the firm, Beyene has interviewed 57 individuals and hired 14. In the 3xh years since Todd Joron became BiblioMondo’s president and chief executive, it has grown from 20 employees to 120. Now, with its R and D centre, BiblioMondo is creating 30 new programming positions.

None of this would give comfort to Bob Elliott, a Vancouver-based IT project co-ordinator who was laid off three months ago. Elliott, 50, was among the first wave of techies to be swept up in the early 1990s by the Internet. Originally a social worker, Elliott up and quit his job one day in 1992, after 13 years of taking care of people. A friend had given him an old Macintosh computer and he’d begun exploring the then-rudimentary Internet, using a modem. He recalls the ex-

citement of his first time on the Net, reaching a site in Australia. “It was such an absolutely mind-boggling moment. I was knocked out.” And hooked. Elliott soon found a job providing customer support for now-defunct Wimsey Information Services, the same company he was using to log on to the Internet. The pay was lousy, but his online connection was free and he was able to telecommute and work from home. “I could support myself doing this thing,” he says. “I thought I was in heaven.”

Today, Elliott is disillusioned with the technology biz. He’s survived takeovers, sweatshops, bad bosses, American owners and his own job-hopping. Even though he was there from the beginning as the tech bubble swelled, and even though he’s been paid in options, he says he’s no millionaire. A little more than a year ago, he

cashed in his first block of options, making roughly $20,000—a nice sum but hardly enough to change his life. In the space of three years, when the global rush to the Internet was on between 1996 and 1999, Elliott worked for five different companies. Now, he’s out of work and considering another career change. (He even responded to a newspaper ad for a part-time coroner.) The tech passion was starting to wane when he was laid off, he says. “My best experience was with the mom-and-pop shop,” he says, referring to his early freewheeling days at Wimsey.

The experts might want to dissuade Elliott from throwing in the towel just yet. In the United States a year ago, there was a shortage of 1.4 million technology workers. While that number has fallen to 900,000, it’s not expected to drop any

further. By 2005, the U.S. department of labour predicts a million technology jobs will go unfilled. Comparable numbers for Canada are tough to come by, but the experts believe the trends are similar. Venture capital oudays also indicate the industry is coming out of a slump, says Korn/Ferry’s Pratzer. While spending has plummeted from a year ago, he says, the current level is about on par with 1999, indicating that start-up investments, like much else in the industry, are returning to more normal, stable levels.

Still, the tech world has seen a massive shakeup. At least 435 substantial Internet companies in North America have shut down since January, 2000, almost half of them in the first four months of this year. More than 92,500 dot-com jobs have disappeared since April, 2000, according to information gathered by Korn/Ferry.

As jobs were cut, so was much of the excess. Rarely seen now are referral bonuses, given to employees who recommended a successful new hire. At Nortel, the bonus was up to $8,000. Today, Nortel has put that program on hold, and in further proof of a much tighter market, is paying university graduates to whom it had earlier offered employment $ 1,000 to stay away.

The contraction in the technology industry won’t last long, predicts Eagle’s Dee. It’s risky to generalize, he cau-

tions, but in Canada, “we should be seeing the job situation improving, come the fall.” Proxenia’s MacDonell agrees. Not every venture can succeed, of course, but it’s easy to forget how quickly technology has become part of daily life. In the office where she worked in 1995, MacDonell recalls, not everyone had a computer on the desk. “It sounds unimaginable,” she says today. Ditto for e-mail. Ten years ago, Canada Post would deliver most of the résumés that came into her office. Seven years ago, they came via fax. “Now, I never get mail and I don’t own a fax machine because everything is electronic,” she says. “There was a whole mix of talents and people that went into those evolutions and there will be a whole mix of talents that will go into the next wave. ” And, of course, a whole mix of disturbables.