| BUSINESSWEEK ONLINE : AUGUST 16, 1999 ISSUE | ||||||||
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| NEWS: ANALYSIS & COMMENTARY
Generation $ Money. BMWs. Options. Talent-hungry tech companies will go to any length to hire a hotshot You could say Anthony Batt is always in play. In the past eight months, the spikey-haired high school dropout has worked as director of site development for Time Warner Inc. as well as director of production at women's online network iVillage.com. That's not to mention his current gig--vice-president for technology at a hot new Los Angeles startup called Lemonpop.com. In the process, the 32-year-old chief technology officer-in-the-making has doubled his salary and is negotiating for options on at least 10,000 Lemonpop shares. A decade ago, a corporate carpetbagger such as Batt would have been blackballed by leery employers. But this self-described ''edgy freak,'' who sports a uniform of T-shirts and khaki cut-offs, has never been more in demand. Recruiters continue to hound him like love-crazy girls. ''Like I've broken up with them or something,'' Batt says. Batt and sought-after Gen Xers like him are benefiting from the New Economy's insatiable demand for talent. Two-year employees are now grizzled veterans. Diplomaless, JAVA-cranking programmers are often more valuable than executives with a decade of experience. ''There's a constant auction going on out there,'' says John A. Challenger of employment-tracking firm Challenger, Gray & Christmas Inc. Even when an employee has just landed at a new job, ''They want to be exploring one that might be even better,'' Challenger says. ''It's like a permanent job search.'' ELITE FORCE. Workers like Batt are still a small elite, just about 1% of the total workforce, but their outsize gains may be moving the job market. When the Bureau of Labor Statistics issued its employment-cost index for the second quarter, it cited huge pay gains in financial services, real estate, and insurance as reasons for the larger-than-expected jump in compensation (page 36). Wall Street firms, for example, are now paying three years' worth of guaranteed bonuses of up to $5 million annually to keep managing directors from jumping ship. Meanwhile, starting salaries for computer programmers have shot up 18.4% this year alone (chart)--vs. just 2.7% for the typical factory worker. The twenty- and thirtysomethings with the right stuff know they're valuable, and they're cocky enough to try a bit of day-trading with their careers. And not just in Silicon Valley or on Wall Street. Consulting, law, and accounting firms--even stuffy old consumer-goods companies--are fighting to keep the best from being poached or going the way of the Internet startup. ''Our people are under siege,'' says Deborah K. Holmes, director of Ernst & Young's Office for Retention. One of Holmes's competitors even goes so far as to pay a several-thousand-dollar bounty per head for any Ernst & Young recruit--from concierge to consultant--sight unseen. In Chicago, Deloitte & Touche puts up 21-year-old accounting interns in subsidized luxury apartments with weekly maid service and Lake Michigan views. That's on top of free laptops and salaries of $3,400-per-month, plus overtime. The scenario gets rosier the higher you go. On Wall Street, one of the hottest games professionals play has nothing to do with the market. It has to do with nabbing a new offer from a competitor that doubles your already multimillion-dollar salary. Then these counterfeit job-seekers dangle their gilded compensation packages in front of their current bosses. In the old days, Nick Brady at Dillon Read or John Whitehead at Goldman, Sachs & Co. would have tossed them out. But the labor squeeze is forcing even top firms to match the offers--and ante up some more options to boot. Across the country, businesses are scrambling to hold on to workers that they have gone to great lengths to find. Silicon Valley is rife with tales of recruiters who prowl company grounds hoping to pick off defectors. One headhunter even had a catering truck outfitted with coffee, doughnuts, and wireless technology for transmitting resumes. Appearing in the parking lots of companies whose stock had taken a sudden dive, ''The Deathmobile,'' as programmers called it, was there to spirit away staffers looking for a fresh batch of options. COMRADES. It isn't hard to find workers who are willing to listen--and recruit their pals. When 24-year-old Sean Suhl left his job as head of interactive for Los Angeles' Digital Entertainment Network for a gig as chief creative officer of Lemonpop.com, he cleaned out his desk and part of his department, luring a dozen Webheads with him. ''It's like being a film director,'' says the platinum-haired Suhl from a cell phone in his Mercedes SLK 230 convertible. ''You do a project, and you move on.'' Among Web startups, it's not uncommon for packs of friends to demand to be hired together. Suhl's boss, Digital Entertainment Network Chief Executive James H. Ritts, understands the way the ground has shifted. ''You know there will be some level of churn,'' he says, mildly. Companies can wind up paying in lots of ways for the rare talent they seek--including settling for second-best. ''Some recruiters will just keep sending someone until maybe they are good enough,'' says David Sterenfeld, a principal with Phoenix recruiter Corporate Dynamix, which specializes in placing technology salespeople. Or businesses are putting people in jobs two levels above where they might normally land at this point in their careers. That makes companies go to even greater lengths to snag a promising applicant. Some employers hold job candidates ''hostage'' by intentionally keeping them for a whole day of meeting and greeting so that they won't be able to attend interviews at rival firms, says Michael Dsupin, district manager for headhunter Atlantis Partners' San Jose, Calif., branch. Managers have called Dsupin and asked him to cancel an applicant's other job interviews that day by proclaiming: ''We're keeping him.'' The captor then offers the candidate a job on the spot. Says Dsupin: ''There's no three-step interview process anymore.'' Even white-shoe venture-capital firms such as Kleiner Perkins Caufield & Byers are not immune. To keep top-level talent in the pipeline for the next hot startup, Kleiner has a ''CEOs in Residence'' program where it parks executives. They get paid a CEO salary, attend partner meetings, look at deals, and when the right startup comes along, they sign up. Some Web companies that don't have the benefit of Kleiner's cachet are so squeezed for talent they are offering speed-vesting so stock options can be exercised in two years instead of the standard four. Other businesses are offering no-strings signing bonuses. BRIBES. But is handing out free BMW Z3's--as Revenue Systems Inc. in Alpharetta, Ga., does--really good for business? ''Companies are basically just coming up with more and more creative bribes to get people to go back to the old-fashioned career path: pay dues and climb the ladder,'' says 32-year-old Gen X management consultant Bruce Tulgan of RainmakerThinking. Some might find that unbearably ironic, considering employers are the ones who did away with the corporate-lifer idea in the first place. The great talent search isn't all carrots. Recruiters in California, for example, have come up with a new shtick: At hiring, workers sign nonsolicitation agreements, which legally bind them against raids. Still, the demand for talented workers is changing the rules--perhaps making the employer-employee compact a little better everywhere. By Michelle Conlin in New York, with Laura Cohn in Washington _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP |
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