OT - Mainframe Programers Obsolete

I'm sure that most of you know that I'm a consultant (they don't want us to
call ourselves contractor :) ) with a large consulting firm.  I've been on t
he
same contract now for almost 9 years.

Across the aisle from me is another consultant from one of our competator -
another large consulting firm.  He has been on site for over 10 years.

Both of expected to be on site for at least another 2 to 5 years depending o
n
when the mainframe is shut down (there is a BIG project going on to migrate 
all
systems to another platform that doesn't use COBOL).

The other day his account manager showed up to talk with him.  When he retur
ned
to his desk it wasn't a pretty sight.  He was told he was getting a 15% cut 
in
pay - why you ask - because he's a mainframe programmer and not marketable.

I immediately got on the phone to my office and asked if they had heard any
rumors or received anything from the company that's contracting us.  No -
nothing and they were quite surprised to hear of the other company's action.
Being in the semi-managerial position that I'm in I do belive what my accoun
t
manager told me.

Is this going to be a on-going thing with the market?   I hope the conversio
n
doesn't happen before the 5 years because this gal ain't ready to retire!!

In article <20040515205854.22589.00000592@mb-m29.aol.com>,
YukonMama <yukonmama@aol.com> wrote:

[snip]

>The other day his account manager showed up to talk with him.  When he retu
rned
>to his desk it wasn't a pretty sight.  He was told he was getting a 15% cut
 in
>pay - why you ask - because he's a mainframe programmer and not marketable.

'Marketability' has nothing to do with what this fellow gets paid, what
the client is invoiced does.

Come Monday this fellow should call his agency and demand to see the
invoices that are being submitted for his hours.

If this demand is not met then I believe he should quit.

If this demand is met and he does not see a 15% difference in invoices
then I believe he should quit.

This sounds, to me, like a 'pimp's classic' of 'Well, the client loves you
but just doesn't have the budget... I know we talked about $x/hr, would
you do it for $x -5/hr?'

(My response to this 'classic' is 'I told you I'd be interested in the job
for $x/hr.  Either you did not relay this to the client or the client did
not take this seriously; either possibility makes either of you an entity
with which I would not wish to work at that rate.  My rate for this job is
now $x + 5/hr.  You have my number; feel free to give me a call.')

DD

YukonMama wrote:

> The other day his account manager showed up to talk with him.  When he ret
urned
> to his desk it wasn't a pretty sight.  He was told he was getting a 15% cu
t in
> pay - why you ask - because he's a mainframe programmer and not marketable.[/color
]

hogwash...   :)  Besides, why does his company need to market him - he's
employed!

Yes, the trend is away from mainframes.  But, I wouldn't think that
being skilled in that area would be a liability.  Either the account
manager isn't telling him the whole story, or they're trying to cut
costs however they can.

> Is this going to be a on-going thing with the market?   I hope the convers
ion
> doesn't happen before the 5 years because this gal ain't ready to retire!!

I'm not in the commercial arena, by any means, but I don't see
mainframes as obsolete - now, or 5 years from now.


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I can believe it. I work for a government agency where about a year ago we
entered into a contract with a single firm to supply our COBOL contract
programmers. This was done as a cost-saving measure. Skipping some of the
messy details, the RFP and bid process forced the respondents into a low-bid
scenario.Therefore, their contract rates are lower (much lower in some
cases) compared to the rates we were paying for staff coming from multiple
companies or individuals. The other bit was that for contract staff we
already had, when their contract expired, they either had to sign-on with
the new company or talk a walk.We had both happen. Those who stayed
generally took a pay cut. The exact amounts I'm not sure but it was
significant.

I know the specifics of my situation don't match with yours but the
underlying conditions are the same. As I hear it, after Y2K and especially
during the past couple of years, the hourly rate for mainframe COBOL
contracts has dropped significantly. (Note that I am a permanent employee
and have not confirmed that for myself.) In essence, it has become a buyer's
market and seemingly some companies/people are being able to do the "take a
pay cut or I can replace you" tactic (as my agency has).

Now, I don't know how it is in the IBM world, but finding quality Unisys
2200 people is not easy. These people deserve at least a fair rate and
probably some premium just due to supply/demand economics. However, it seems
that is not playing out due to the (real or perceived) decline in rates for
COBOLers in general.


"YukonMama" <yukonmama@aol.com> wrote in message
news:20040515205854.22589.00000592@mb-m29.aol.com...
> I'm sure that most of you know that I'm a consultant (they don't want us
to
> call ourselves contractor :) ) with a large consulting firm.  I've been on
the
> same contract now for almost 9 years.
>
> Across the aisle from me is another consultant from one of our
competator -
> another large consulting firm.  He has been on site for over 10 years.
>
> Both of expected to be on site for at least another 2 to 5 years depending
on
> when the mainframe is shut down (there is a BIG project going on to
migrate all
> systems to another platform that doesn't use COBOL).
>
> The other day his account manager showed up to talk with him.  When he
returned
> to his desk it wasn't a pretty sight.  He was told he was getting a 15%
cut in
> pay - why you ask - because he's a mainframe programmer and not
marketable.
>
> I immediately got on the phone to my office and asked if they had heard
any
> rumors or received anything from the company that's contracting us.  No -
> nothing and they were quite surprised to hear of the other company's
action.
> Being in the semi-managerial position that I'm in I do belive what my
account
> manager told me.
>
> Is this going to be a on-going thing with the market?   I hope the
conversion
> doesn't happen before the 5 years because this gal ain't ready to retire!!

yukonmama@aol.com (YukonMama) wrote:

>The other day his account manager showed up to talk with him.  When he retu
rned
>to his desk it wasn't a pretty sight.  He was told he was getting a 15% cut
 in
>pay - why you ask - because he's a mainframe programmer and not marketable.

There are two ways to be a contractor:

1. An 'innocent' or traditional employee of the contracting company, as is t
he
case here, doesn't know his or her bill rate, thus doesn't know the contract
ing
company's take. The split between worker and contracting company can range f
rom
20-80 in Big Five companies to 75-25; the most common is 50-50. When the
contracting company says his salary is being cut $5/hr, he doesn't know whet
her
the bill rate was reduced by $10, $7, $5 or ZERO. Without that knowledge, he
's
in no position to negotiate.

2. An 'active' contractor finds his or her own gigs and negotiates a bill ra
te.
Then he or she calls a few contracting companies on the Approved Vendor List
 to
ask the lowest markup they'll accept. Typical in this situation is 7-15%, mo
st
commonly 10% (plus employer's taxes). If the bill rate changes, the contract
or
will know about it before the contracting company.

Think about the difference between 80% of the bill rate (after taxes) vs. 50
%.

"Robert Wagner" <robert.deletethis@wagner.net> wrote in message
news:40a91763.9820172@news.optonline.net...
> yukonmama@aol.com (YukonMama) wrote:
> 
returned 
cut in 
marketable.
>
> There are two ways to be a contractor:
>
> 1. An 'innocent' or traditional employee of the contracting company, as is
the
> case here, doesn't know his or her bill rate, thus doesn't know the
contracting
> company's take. The split between worker and contracting company can range
from
> 20-80 in Big Five companies to 75-25; the most common is 50-50. When the
> contracting company says his salary is being cut $5/hr, he doesn't know
whether
> the bill rate was reduced by $10, $7, $5 or ZERO. Without that knowledge,
he's
> in no position to negotiate.

Why not ask the contracting company what the bill rate is?

>
> 2. An 'active' contractor finds his or her own gigs and negotiates a bill
rate.
> Then he or she calls a few contracting companies on the Approved Vendor
List to
> ask the lowest markup they'll accept. Typical in this situation is 7-15%,
most
> commonly 10% (plus employer's taxes). If the bill rate changes, the
contractor
> will know about it before the contracting company.
>
> Think about the difference between 80% of the bill rate (after taxes) vs.
50%.

"Mudd Bug" <muddbug@cox.net> wrote:


>Why not ask the contracting company what the bill rate is?

I have. They refuse to disclose it. We sometimes find out by accident. At on
e
place, the mailroom received an invoice, saw my name on it, and forwarded it
 to
me. Whoops.

Well, a long long long time ago, before these brokers became
such dirtbags, I modified their contracts to describe compensa-
tion in terms of percentage, rather than $$.

IOW. The broker says they'll pay you $5/hr. But, I strike that
condition, and replace it with they'll pay you 80%. Of course,
this does you little good now.

I would suggest that you just begin to make plans to go out on
your own, and forget about these parasites.

Gary




"Robert Wagner" <robert.deletethis@wagner.net> wrote in message
news:40ac3a44.215387764@news.optonline.net...
> "Mudd Bug" <muddbug@cox.net> wrote:
>
> 
>
> I have. They refuse to disclose it. We sometimes find out by accident. At
one
> place, the mailroom received an invoice, saw my name on it, and forwarded
it to
> me. Whoops.
>
>

>From: robert.deletethis@wagner.net  (Robert Wagner)
>Date: 5/17/04 3:50 PM Eastern Daylight Time

>There are two ways to be a contractor:
>
>1. An 'innocent' or traditional employee of the contracting company, as is
>the
>case here, doesn't know his or her bill rate, thus doesn't know the
>contracting
>company's take. The split between worker and contracting company can range
>from
>20-80 in Big Five companies to 75-25; the most common is 50-50. When the
>contracting company says his salary is being cut $5/hr, he doesn't know
>whether
>the bill rate was reduced by $10, $7, $5 or ZERO. Without that knowledge,
>he's
>in no position to negotiate.
>

This is a known - there was no reduction in bill rate.  There was no increas
e
either.  While I don't know my own bill rate I do know the rates of those un
der
me and it wouldn't take me long to figure my own out by doing a bit of math.
  I
do know that I'm doing better than 50/50.

>2. An 'active' contractor finds his or her own gigs and negotiates a bill
>rate.
>Then he or she calls a few contracting companies on the Approved Vendor Lis
t
>to
>ask the lowest markup they'll accept. Typical in this situation is 7-15%,
>most
>commonly 10% (plus employer's taxes). If the bill rate changes, the
>contractor
>will know about it before the contracting company.
>
>Think about the difference between 80% of the bill rate (after taxes) vs.
>50%.

Yes - 80% of bill rate.... then you deduct your insurance, your own SS and
Medicare, your own this that and the other thing and you're still taking hom
e
aprox the same as going with a firm and have all the fun of doing your own
paperwork.

In article <20040522020119.21319.00001898@mb-m04.aol.com>,
YukonMama <yukonmama@aol.com> wrote: 

[snip]
 
>
>This is a known - there was no reduction in bill rate.  There was no increa
se
>either.

So the bill rate stayed the same but now the company is making more profit
off an 'unmarketable' employee.  Neat trick, eh?

I would say it is time for this guy to give notice and clean out his desk;
the company he works for is, in effect, asking him to pay for his own
Vaseline.

DD