October 31, 2002, 12:00 AM

More Turmoil In the Job Market

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Even employers with limited budgets should avoid what Berry calls “the peanut butter approach”-giving everyone the same thing. “If my average is a 5% increase I’d still better be giving my best folks 8%. Those that are solid workers that I don’t want to lose get 5%, and everybody else little or nothing, because that sends a message,” Berry says. Meta Group calculates that retention bonuses for IT workers across a broad array of sectors jumped from 12% to 44% during the past year. Across the range of IT skills, the most difficult to retain were those relating to e-commerce, Internet and application development, according to Meta.

The dot-com boom days may be gone, but they’ve left a legacy in terms of workers’ expectations. Employees still are attracted by a more casual work environment, benefits such as flexible time, and on-site services such as daycare or dry cleaning. Meta Group even recommends that to the extent they are able, employers consider incentives such as qualified financial assistance for employees’ personal needs such as car or home loans. It’s also important to give highly skilled IT workers frequent access to training in new technology, as much for their own job satisfaction as for the good of the organization, Schafer adds.

More tech temps

If building IT skills from within the company and beefing up retention efforts to keep those employees is a way retailers and others are staffing those tough-to-fill IT jobs, then using contractors is another. IT contractors with in-demand skills generally command salaries one-half to one-third higher than regular staff who may fill the same function-one reason employees tend to use them only on a temporary basis, such as when launching a major web initiative, for example.

In fact, a joint survey by People3 and Mercer forecasts that the use of IT contractors, off during 2001 as a result of tighter budget and deferred or discontinued IT projects after the first flush of the dot-com fallout, is on its way to a rebound. 35% of companies surveyed said they expected to increase their use of contactors as the economy improves.

But e-retailers may find that in the long run the employees with the most to offer-and those that may be hardest to find-are not so much specialists whose skills are confined to the latest hot skill, but those who continuously use every opportunity to expand their abilities. “There is some change in emphasis year to year, but what I see happening is that the pool of critical skills it takes to succeed keeps expanding,” Schafer says. “A third of the companies we interviewed say they have never slowed down their hiring; it’s just a lot more targeted. Though there may be fewer opportunities out there than there were two years ago, workers with really good skills are still getting jobs.”


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