Recruiter Nancy Albertini on Layoffs in Silicon Valley

For 20 years, Nancy Albertini has been recruiting candidates into the tech industry, most recently through her three-year-old firm Albertini Group. Though the small, 11-person, outfit is based in Dallas, Albertini works out of Silicon Valley, conducting executive searches for both startups and bigger corporate behemoths. We talked for a few minutes just now about where we are in terms of layoffs, and new job opportunities, in the Valley.

The layoffs are really starting to pile up out here. Do you think there’s been an overreaction to the economic downturn, or have people yet to react strongly enough?

Boy, this is a very difficult market. Overall, the venture community has a more global view than startups and they believe this crisis is deeper than the operational people do. So in some cases, I think they’ve pressed for cuts that are too deep, hoping to cut just once. At the same time, we’re likely to see more layoffs throughout this year.

Can you quantify how many fewer placements opportunities you’re seeing?

Going into this new year, it is grim, grim, grim. I only do executive hiring so I can’t speak to the layers underneath, but this downturn is deeper and broader than anything I’ve seen. I don’t think people are overstating the gravity of the situation. I wish they were, and I hope they’re wrong. But it’s grim, and I’m hearing [the downturn is going to be] longer than shorter.

What opportunities are you seeing? What kinds of positions are people still filling?

I’m seeing some CEOs. CFOs, you can’t do without in this environment. I’m seeing engineering, and sales — a focus on what will drive revenue, and how companies can market themselves to new markets. Also, in merger situations, I’m seeing an emphasis on who is the right person to run the combined company.

Have the qualifications changed in any way?

Yes, people want CEOs who understand their business, not just a functional executive. That’s also true on the engineering side. They want people who immediately understand what impacts their market and their profitability. If you’re a VP trying to be a CEO, you’re probably out of luck. A board is going to choose the more seasoned executive in this environment. I think it’s more difficult for people to be given a shot.

What percentage of your work now is opportunistically replacing people; there’s obviously a lot of talent floating around at the moment.

It’s true. If you’ve got a sales guy and he’s let the market get him down, then you’re in a position of making a change, finding someone who can think creatively about how to improve sales and motivate a team. I’ve actually just made a hire to expand our business, taking advantage of someone who was available and who I think is just incredible.There’s some incredible talent that you couldn’t have accessed before.

I bet they aren’t being paid as much as their predecessors, either.

Pay has gone down, yes. You’re just not going to see the packages that you’ve seen in the past. I don’t have enough information yet to quantify how much those packages are changing, but I’m watching the mindset right now and how offers are going out. If I had to guess, I’d say offers are 10 to 15 percent lower than they were, but it also depends on the state of the company. If they are focused on one individual, that person may be able to get further in his negotiations, but overall I’d say that isn’t the case.

How else are pay packages changing right now? Are gym memberships a thing of the past?

Perks are definitely going away. And people are going to their teams and saying, “I need you to sign up for a pay cut.” I have a company right now that everyone took a 15 percent cut and the CEO took a 50 percent cut. People are banding together saying, these are tough times and if we’re going to come out of this, we’re going to have to batten down the hatches.

What do you think of President Obama’s resolution to cap CEO pay at those companies that receive federal bailout money?

In a bailout environment, that’s one thing, but I hope we don’t get to a point where we’re generally thinking about capping CEO pay. Being a CEO is all about risk and reward, and they work their tails off. CEOs aren’t coming in at 10 o’clock and leaving at 4. It’s a tough job.

Is it possible to say who in the Valley is hiring right now — specifically?

I can’t, though I can say that it’s corporations, not startups.

I will just tell you that it’s bad, here and everywhere. After the tech bubble, things were bad in Silicon Valley but you still had other markets that were doing well: real estate, health care. But I pulled into a Chicago hotel last night and I was shocked by how empty it was. Typically busy malls? Empty. You just have to look around and ask: my God, where is everybody?