Utility IT staffing likely to become increasingly competitive issue
It's somewhat counterintuitive in the midst of a recession and with 10 percent unemployment and 17 percent underemployment to mention that utility IT executives are beginning to become concerned about having enough qualified staff to do everything they're being asked to do in the current business environment. Despite the logical disconnect, that is, nonetheless, the case.
In the first place, utilities have been hurt by the recession in a number of ways, including declining electrical usage and the increased cost of credit. This has forced them to reduce budgets, and IT at many utilities still is viewed as a cost center rather than a strategic asset, as it should be. Thus many utility IT departments already are operating short-handed. At the same time, they are under great pressure to upgrade systems to deal with the ubiquitous smart grid pressure from the federal government and elsewhere.
There also is the problem that U.S. colleges and universities still aren't turning out as many engineers and IT professionals as are needed. They haven't been for a number of years.
"That is a serious problem," said Lynne Ellyn, senior vice president and CIO of DTE Energy, in a recent interview. "It was probably four or five years ago I read 'Workforce 2020' which was a study by the Hudson Institute on just exactly this issue -- that projecting out to 2020 what the workforce is going to look like," Ellyn continued. "And there's going to be critical shortages of medical personnel. They're already starting to see that; critical shortages of engineering and deep technical sorts of disciplines all across the board."
Becky Blalock, senior vice president and CIO at Southern Company added during the same interview: "We're definitely going to be challenged. We're challenged even in this economy on specialized skills. I mean Lynne knows, I've called her and asked for help, and she's pointed me where I could get people that have particular kinds of skills. Security skills are going to be in very hot demand. Just to give you all an idea, we hired a kid out of Georgia Tech, he worked for us for two years -- which means that we trained him -- and Homeland Security offered him a job making $250,000 a year. It's a contract, it's not a permanent job, but if you're 25 years old and right out of college what are you going to do? You're going to go take the job. Well, I can't afford to pay somebody that kind of money."
The issue is so serious -- or tempting -- depending on your viewpoint, that new companies are likely to spring up to help deal with it; one person's problem is another's opportunity. For example, Chris Hackett, former vice president at Sprint, has formed what he calls a "global staffing company" to help utilities and other businesses that are short of IT staff.
"When we see what's happening in the changing environment, the workforce is aging in a lot of areas," Hackett noted. "There are lots of different pieces of the puzzle. For one, some of the stimulus funding for healthcare was around electronic medical records. A typical doctor may have 8,000 pages of records that have to be digitized. A lot of people are going to have to get systems set up to deal with that."
Hackett also sees opportunities in utilities. "With smart grid, a lot of utilities are not going to have enough IT staff. Where utilities can identify needs within their own IT shops, we can participate with them in terms of a partnership and help them ultimately drive down the cost."
Of course, organizations like Hackett's, as well as larger groups like Capgemini and IBM, also are going to be looking for IT staff they can place at utilities on a contract basis.
Going forward, two things seem to be apparent. First, utilities are going to have to become increasingly creative in how they get IT work done. And, secondly, if you have a child about to enter college, now would be a good time to try to interest them in information technology/computer sciences. It's only going to get worse as all we old-timers (aka baby boomers) begin to retire -- assuming we have something left to retire on.