Mainframe skills, pay at a premium

IT managers looking to cut labor costs during the ongoing recession might want to think twice before laying off any of their workers who have mainframe or data center skills.

With mainframe shipments on the rise and legions of traditional mainframe IT workers nearing retirement age, technology managers last week said it's becoming increasingly difficult and costly to replace employees who have deep experience in Cobol, CICS and other mainframe technologies.

For example, the Workplace Safety and Insurance Board of Ontario is shelling out 10% to 15% signing bonuses to new workers with mainframe skills. The Toronto-based board, which oversees workplace safety and workers' compensation issues for the province of Ontario, also pays "hot skills" premiums to mainframe experts. That can boost their annual salaries by as much as 10%, said David Londry, director of the board's corporate information center.

At the Automobile Club of Southern California, a Costa Mesa, Calif.-based affiliate of Heathrow, Fla.-based AAA (formerly known as the American Automobile Association), IT manager Bill Reinl said he's using part of his annual training budget to bring younger workers up to speed on mainframe technologies.

And the skills crunch is only going to get worse, according to Stamford, Conn.-based Meta Group Inc. As part of preliminary results from a survey of 300 midsize and large companies, Meta last month said it found that 55% of IT workers with mainframe experience are over 50 years old.

A bigger problem is that more than 90% of the companies that have mainframe staffs said in the survey that they have "zero strategy" for dealing with the diminishing pool of skilled workers, said Meta analyst Maria Schafer. Meanwhile, all indications are that legacy mainframe systems and applications - not to mention new technologies such as IBM's zSeries servers - will be around long after those workers have retired.

Companies continue to add a total of about 5 billion lines of Cobol code annually to their data center systems, according to Bill Ulrich, president of management consulting firm Tactical Strategy Group Inc. in Soquel, Calif. And IBM in January said its annual mainframe revenue grew last year for the first time since 1989.

Industries that are expected to be hit particularly hard by the mainframe skills shortage include telecommunications, banking and finance, insurance and government, all of which have huge installed bases of mainframe systems.

"The mainframe is the foundation that everything is built on [here]," said Don Greb, first vice president and manager of information processing engineering services at Mellon Financial Corp. in Pittsburgh. "The majority of our data is still residing on a mainframe, even though a lot of it is front-ended through the Web and e-commerce applications."

Among other steps it is taking aimed at preserving its mainframe know-how, Mellon has launched a summer internship program during which the company teaches mainframe skills to university students it hopes to recruit after they graduate, Greb said.

But David Lewis, CIO for the Massachusetts state government, said he's more concerned about the skills that can't be taught and have to be learned by workers through hands-on experience.

"Where you start running into really tricky issues is around the products that run on the mainframe and how they interrelate to each other," Lewis said, calling that "an acquired skill" that will take time for new workers to grasp.

"You don't go to school to see how CA interacts with IBM," Lewis said, referring to software vendor Computer Associates International Inc. in Islandia, N.Y. "You learn it by experience. That's where I frankly think the greatest risks exist [for companies]."

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