Tech Council chairman: IT industry not in danger, but pay dropping -- Gazette.Net


The outsourcing of information technology jobs being seen at Bethesda hotel giant Marriott International is not likely a harbinger of more to come, technology and business officials say.

Marriott executives said this week they are cutting “hundreds” of jobs and reorganizing the company’s information technology department in Bethesda in response to a more competitive global business environment. Layoffs are expected to start as early as next month.

Affected employees can apply for job openings with both Marriott and outside contractors that include IBM Corp. and Xerox Corp.

Larry Letow, board chairman of the Tech Council of Maryland, a high-tech trade association based in Rockville, said he doesn’t think there will be a rush of more such announcements in the near future, even with the area under a cloud of federal sequester budget cuts.

“Certain jobs can’t really be outsourced,” Letow said. “But we are seeing salaries drop for technology workers as much as 20 percent with new contracts.”

At Convergence Technology Consulting, a Glen Burnie technology services company where Letow is president and CEO, tech jobs have remained inhouse. “Our data centers are within the United States,” Letow said. “Many of our clients ask that our help desk be in the U.S.”

Others said they hadn’t heard of many more such anouncements of IT jobs being outsourced in Montgomery and Frederick counties lately. Marriott made “a pure business decision,” based on what executives felt was best, said Steve Silverman, director of the Montgomery County Department of Economic Development.

“It was not a reflection of the business climate in Montgomery County and the state of Maryland,” he said. At least some of the jobs Marriott is outsourcing could stay within the county with contractors, Silverman said.

Helen Riddle, manager of the Frederick County Business Development and Retention Division, said she hadn’t heard of local companies there outsourcing tech workers. “Some IT companies here are offering signing bonuses for computer programmers,” she said.

Across Maryland, employers have added a net of 5,200 technology, scientific and professional services jobs in the past year, according to the latest state figures. That sector includes IT workers, as well as others, like accountants.

Lockheed trimming IT unit

At least one other area company is trimming the IT department, but not doing large-scale outsourcing. Bethesda defense giant Lockheed Martin approved 243 voluntary layoff offers to mid-level managers in its Information Systems & Global Solutions segment, said Mary Phillips, a company spokeswoman.

The layoffs, which she said are not technically buyouts, will take effect today. Not all of the layoffs are occurring in Gaithersburg, where the information systems unit is based, but they are companywide, Phillips said. She did not know how many would occur in Montgomery County.

Lockheed made the offers — which come with one week’s severance pay for every year worked at the company — to about 4,000 managers in February. Some 260 employees accepted, while 17 were not approved.

Lockheed is not planning additional layoffs in the near future, though executives will continue to evaluate the workforce levels, Phillips said.

Lockheed’s information systems unit was the only one among the company’s five business segments to see a drop in net sales and operating profit last year. Sales in 2012 declined 6 percent from 2011, to $8.9 billion, while profit was down 8 percent to $808 million, according to Lockheed’s latest earnings report.

AstraZeneca adding; Areva moving HQ

Some positive news for the county came this week when AstraZeneca, parent of Gaithersburg biotech MedImmune, said it will establish a global research and development center at MedImmune’s headquarters. Marketing and specialty care commercial functions will be centered in Gaithersburg, with about 300 jobs moving there from Wilmington, Del., by 2015.

Another move involves the North American headquarters of nuclear energy technology services company Areva from Bethesda to Charlotte, N.C. The Bethesda office will close, and some 15 positions there will be transferred to Charlotte, said Kelly Cousineau, a company spokeswoman.

There are now some 60 Areva employees in Bethesda, and plans are being made to transfer all of them without layoffs, she said. For instance, the government affairs segment plans to relocate to Washington, D.C., Cousineau said. Transnuclear, a division of Areva, will maintain headquarters in Columbia.

Montgomery County’s unadjusted unemployment rate has risen slightly in recent months and was at 4.9 percent in December, the most recent figure available Thursday. That was up from 4.7 percent in November.

Frederick County’s jobless rate was 5.5 percent in December, up from 5.3 percent in November. January jobless rates for counties were scheduled to be released today, said Maureen O’Connor, a state labor bureau spokeswoman.

Maryland created almost 7,000 jobs in January, with more than 8,000 private-sector positions formed, according to figures released this week. The total state job figure for January was the highest in almost five years.

Maryland’s adjusted unemployment rate remained 6.7 percent in January, the same as in December.

The largest statewide jobs gain in January was seen in professional and business services, such as accounting and tax preparation, which added about 4,000 mostly administrative positions. Federal agencies decreased employment by 500 jobs, while county government saw an 800-job decline.