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|In: Industry Commentary|Last Updated:

In July of 1973 I returned from a semester abroad in Guatemala to find that gasoline was in short supply, prices had tripled, and if you wanted to fill your tank you had to wait in line.

A long line.

Then some wise guy started rumors of a toilet paper shortage. Predictably, huge crowds of worried consumers descended on supermarkets around the country like hordes of locusts on wheat crops, snarfing up every package of the stuff they could, stockpiling this vital commodity against the predicted dearth.

There was, of course, no shortage. The expectation, though, had the same impact as a real one, although for a shorter time.

Employers perceive the existence of a serious shortage of IT professionals right now. So why do so many give the employees they have so little reason to stay?

We’re all nuts. As evidence, the June 29 issue of Business Week, citing the Bureau of Labor Statistics, said that over the past decade, programmers’ pay has lost 1.5% to inflation. Here’s a hint to all you capitalist geniuses out there who run our companies: The law of supply and demand says that if something is in short supply and high demand, prices go up or we get a shortage.

If there really is a shortage, shouldn’t companies be trying to reduce turnover by treating employees better and paying them more? It’s more affordable than spending the full year’s salary plus benefits it generally costs to replace each employee who leaves.

Maybe this means there is no shortage. The statistics cited to demonstrate the shortage show that while 95,000 new IT jobs will be created this year, only 25,000 new computer science majors will graduate.

Inferring a shortage from this data turns out to be wrong. I’m indebted to fellow Perot Systems-ite Robert Fendley for pointing me to the evidence – research by Norman Matloff at the University of California at Davis (check out http://heather.cs.ucdavis.edu/itaa.real.html for more details).

Matloff’s research is revealing. It turns out that about 25 percent of today’s IT workers have computer science degrees. Now let’s see … 25,000 computer science graduates divided by 95,000 new jobs comes to … well I’ll be hornswoggled! We’re in exactly the same shape we’ve always been.

What a surprise. Want to quadruple the number of qualified applicants? If you’re screening out applicants who lack computer science degrees, you have an easy solution. (Something to ponder: Since most hiring managers lack computer science degrees themselves, does this mean they wouldn’t give themselves an interview?)

A lot of our shortage is self-inflicted. The absolutely stupid practice of requiring computer science degrees, which causes HR to keep three-quarters of your potential workforce away from you, is the just the most obvious example. (Memo to our competitors: Please keep on doing this. Thanks.)

Here’s another example of how most of the problem stems from our own ridiculous expectations: Many of us hire “only top-quality applicants.”

One of 10 IS professionals I’ve known were top quality. That isn’t surprising, though, since I define “top quality” as being among the upper 10 percent. The entire workforce could double in ability and we’d still have a shortage of top-quality people.

I’m in favor of hiring great people, but you have to be realistic. Want to hire only the best? Pay top dollar and create great working conditions. The best can afford to be very choosy.

Your alternative: Hire some of the best. Also hire some journeymen programmers, and implement great processes so they can maximize their contribution to your success. And be willing to train promising applicants who have the right aptitude and attitude, understand the business, and want to learn technology.

I’ve heard from an awesome number of IS Survivalists whose backgrounds are in mathematics, physics, chemistry, the military, anthropology, international studies, or clerical work. Despite their lack of computer science training, they are successful IS professionals.

Often they are more successful than their computer science co-workers, in fact, because these supposedly less-qualified people acquired their skills solving real-world problems and stayed in the field because they showed both an aptitude and an affinity for the work.

Why, oh why, do so many companies deliberately ignore people like this?

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|In: Business Ethics|Last Updated:

When it comes to government intervention in the antitrust action against Microsoft, lots of people say the marketplace should decide, even when there’s no longer a competitive marketplace and the whole point of the antitrust laws is to either preserve competition or compensate for its absence.

In the labor market, though, there’s widespread desire for government intervention to keep out “cheap foreign labor” – protectionism, in a word, to prevent competition.

Technical professionals are in short supply. Still, some Americans can’t find work, or at least can’t find it at their desired salary in their city of residence. Then they read about an influx of inexpensive foreign technical talent, especially from Asia and the Indian subcontinent. Adding two and three to get 23, they conclude that greedy American employers are hiring cheap foreign labor at their expense.

Like it or not, American technical talent, like all American labor, competes in a global labor market. When the government takes protectionist action we compete through our employers. When it doesn’t, we compete as individuals.

Take your pick, but when, for example, SAP wins a contract over Oracle in the ERP market, foreign jobs increase and American jobs decrease just as surely as when an American company hires a Pakistani programmer. One way or another, we all compete globally for our jobs.

Many American technical professionals have contributed to the developing mess through complacency, assuming job security from, for example, designing and programming batch Cobol systems. American employers certainly aren’t blameless in this fiasco either. You probably have employees like this batch Cobol programmer. When was the last time you provided career counseling or growth opportunities? Do your codger-programmers even know their jobs are at ever-increasing risk?

If you’re recruiting you probably have the right headcount (or close to it) but are undergoing some change that has led to a skills mismatch. That means employees who used to be competent aren’t anymore, and people get cranky under those circumstances. Since shooting your current employees is inhumane, frowned upon, and illegal in most states, here’s a more productive alternative:

1. Communicate the change you’re undertaking and why you’re undertaking it every chance you get. Your whole IT leadership team must preach the change, what it means, its implications and consequences, including the likelihood that not everyone will succeed in the new environment.

2. Hire a few key positions from the outside to lead by example. Hire the best people you can find. You want your employees to think, “None of my co-workers could do that.” As an alternative, bring in a consulting firm to work on projects in “blended teams” with your employees to help them learn the new skills. (Disclaimer – my company is in that business so I’m unavoidably biased in its favor.)

3. Retrain your retrainable employees. It’s cheaper than replacing them. Identify those least likely to succeed, tell them in no uncertain terms your concerns about them, give them every chance you can, and say good-bye to those who fail. You’re responsible for providing opportunity. They’re responsible for taking advantage of it.

4. Recruit replacements from wherever they live. Hire the best people you can find – the best, not the cheapest – and make no apology for doing so.

Great companies need great people. Hiring foreign labor because it’s cheap doesn’t get you great people.

But there are plenty of talented foreign technical professionals who are willing to work harder, and for less money, than their American counterparts. The resentment some American programmers express toward Indian, Pakistani, and Asian programmers is nothing more than simple bigotry.

It’s easy to preach competition when it’s Microsoft against Sun. When it comes to jobs, theory gets real personal, and that just doesn’t bring out the best in people.

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