By George Avalos San Jose Mercury News.
SAN JOSE, Calif.
Emily Cervino, an executive with Fidelity Investments, knows a lot about the job market and hiring employees. But her expertise goes well beyond that. She has a laser focus on what employers can do to keep talent that they've recruited and hired. The San Jose Mercury News recently talked with Cervino about jobs, employees and how to keep workers happy in a hot labor market like that in the Bay Area.
Q: What's your assessment of the Bay Area job market?
A: The job market in the Bay Area is hot, hot, hot. I just drove from San Jose to San Francisco, and I saw firsthand how busy the freeways and roads are with so many people working.
Q: What's causing the job boom?
A: It's the tech industry. The technology industry, in particular, has an intense need for talent. They are hiring at a substantial rate.
Q: How intense is the appetite for talent right now compared with other periods?
A: I went through the dot-com boom about 15 years ago. Today, we are experiencing a demand for talent that is even stronger than we saw during the dot-com boom. All of the indicators across the Bay Area point to stronger demand now than back then.
Q: What does this mean for employers?
A: There is a real war on now to obtain talent. Employers are facing some major challenges to attract and retain talent at their companies.
Q: What are employers trying to do to retain employees?
A: Companies are trying to offer an array of benefits.
Q: What are some examples of the benefits?
A: In general, the concept of perks has really taken root. At some of the tech companies, it's like you're walking down Main Street at Disneyland. Haircuts, bike repairs, on-site manicures and pedicures. Free food.
Q: What are some of the other perks?
A: More companies are turning to stock compensation. They also are turning more to traditional benefits. Health care, retirement plans and particularly stock packages. The technology industry has a long history of using stock to attract and retain employees.
Q: Which stock compensation packages are the most popular?
A: In the world of stock compensation, you have the major categories of long-term compensation and direct purchase plans.
Q: What are examples of long-term plans?
A: For long-term incentives, you have stock options, restricted stock and performance awards.
Q: What are some short-term plans that are commonly available for employees?
A: Typically, companies make available employee stock purchase plans. Those are broad-based plans that provide every employee of the company an opportunity to purchase stock at a discount. As the talent market heats up and employees are looking at ways to enhance their benefit packages, employee stock purchase plans can play a very important role in employee compensation and retention.
Q: Are these kinds of plans becoming more prevalent due to the competition to attract employees?
A: It's not so much that they are becoming more prevalent, it's that the employers are altering the plans to make them more attractive.
Q: What are the changes being made to stock purchase programs?
A: Companies are trying to make the plans more attractive to employees. They are increasing the discount to the stock price that the employee pays for the shares. This can encourage more employees to participate in the plans.
Q: Are there any indications this is working?
A: Companies are reporting higher levels of loyalty motivation and knowledge of the company's stock performance.
Q: Are some of these efforts more intense in Silicon Valley?
A: A lot of competitors in Silicon Valley are located near each other. There is a lot of cross-pollination among companies. So there is pressure for companies in Silicon Valley to be aware of what their competitors are doing. They are really trying to be aware of the benefits that their rivals are offering to employees.
Q: How far are companies going in terms of the benefits in the stock plans?
A: We typically see companies in Silicon Valley offering the maximum benefit allowed by the IRS. In the rest of the United States, the benefit levels are more moderate. These are tax-qualified plans, there are tax benefits to employers who participate in these plans, so the IRS limits the allowance for these plans.
Q: What should employees do to fully take advantage of these plans?
A: People need to find out if there is a stock purchase plan, what are the benefits, and should they participate. These plans can be very valuable for employees. Free food in the cafeteria is a no-brainer. But stock purchase plans have some real value. ___ Emily Cervino Organization: Fidelity Investments Title: Vice President, Fidelity Stock Plan Services Age: 45 Birthplace: Anaheim, Calif. Education: Santa Clara University, bachelor's degree Residence: San Jose, Calif. ___ Five things about Emily Cervino 1. She got her first job in equity compensation in 1996 by answering a classified ad in the San Jose Mercury News. 2. Employee stock purchase plans are a favorite of hers because she upgraded her home thanks to such a plan. 3. Since graduating from Santa Clara University, she has lived in three places, all within walking distance of the school. 4. She has two children, boys ages 16 and 12. 5. Her favorite book is "The Poisonwood Bible" by Barbara Kingsolver.