By Shera Dalin
While Boston or Silicon Valley jump to mind when you think of technology hubs, St. Louis has a lengthy spreadsheet of assets that make it a location of choice for information technology operations and careers.
“Our strength is our legacy of strong
corporate headquarters and strong IT backbone in those companies that has caused us to develop a tremendous capacity in
the marketplace,” says Steve Johnson,
senior vice president of economic development for the Regional Chamber and
Growth Association.
Those companies have outstanding IT talent to serve the needs of the region at companies like Anheuser-Busch, MasterCard, Wachovia, Boeing, Sigma-Aldrich, Edwards Jones, Brown Shoe, Enterprise Rent-A-Car, Scott Air Force Base and many more,
says Lendell Phelps, vice president of marketing and business development for AT&T and chairman of three different boards of chief information officers that AT&T operates to help CIOs network and solve problems.
“The fact that this market has three CIO boards of leaders who get together regularly to work for the greater good of IT executives makes it unique, special and a good place to be,” Phelps says. “There are lots of associations, firms and groups that do this around the country, but they typically tend to be spectator sports; they show up at the meeting and they take notes, have lunch or a cocktail, and then they leave.
“These board members in St. Louis are players in the game. They contribute.”
In other cities where Phelps chairs CIO boards, the IT community isn’t as engaged, proactive or cooperative.
“The thing about St. Louis is that this spirit of collaboration is powerful here. It’s all for one and one for all,” Phelps says. “CIOs here don’t get mad if you hire away one of their people; they understand it makes
companies stronger overall.”
Having top-ranked universities that produce outstanding IT talent is a draw, says Blair Forlaw, director of the Greater St. Louis Works program at the RCGA. The civic initiative helps IT departments and professionals network, find personnel and jobs, and coordinates retraining programs for laid-off workers.
“(Employers) want to see a steady flow (of graduates) and in certain segments,”
she says. “There are about 20 different
segments within IT, and generally we look pretty good.”
Beyond collaboration, St. Louis has some innate strengths that make it attractive for bringing and keeping IT operations here. Day Veerlapati, president and CEO of IT
firm S2Tech in Chesterfield, says he has discovered that St. Louis has lower costs than those in the Raleigh-Durham, N.C., area, where he opened a regional development center last year.
“There are definitely advantages here compared with other states. Missouri is very friendly for new business,” Veerlapati says.
Being in the central time zone is also an asset when trying to serve clients based all over the U.S. as well as coordinate work with employees 11 and a half hours earlier at his offshore development center in Hyderabad, India, he says.
He is also able to attract skilled talent from the area’s excellent universities, retain them because of the quality of life in
St. Louis, and travel less expensively to meet with clients and prospects because
of St. Louis’ central location and low-cost airfares on carriers like Southwest Airlines.
“The jobs program, tax incentives and training program also makes our costs a little lower than other states,” Veerlapati observed.
In fact, he is considering transferring much of the work from S2Tech’s new regional development center in Durham to St. Louis for those very reasons.
“Attrition is lower here and that holds down costs,” he says. “I really like that.”
The numbers tell the story about St. Louis’ IT industry quite succinctly.
IT workers make up about 3.3 percent of the industry, accounting for 45,610 St. Louis jobs in 2008. But that figure is up 10 percent from 41,190 the year before, according to the U.S. Bureau of Labor Statistics.
Even more important are the wages IT jobs command and the impact they have on the region’s economy. Jobs such as programmers, information system managers and software engineers range on average between $33 to $49 an hour—significantly higher than the average $16 an hour earned by typical
St. Louis-area workers.
Computer system design is the single largest IT industry segment here, with just over 13,000 employees at 1,195 firms, followed by telecommunications with about the same number of employees in 471 firms, according to the Bureau of Labor Statistics.
And there is a new development in the mix.
“We are starting to get pretty competitive with data centers,” Johnson says. “They aren’t huge employers, but they are expensive facilities that require strong infrastructure with telecom and fiber, which St. Louis is very strong in. It also requires affordable
and reliable electricity, and we are the second least expensive state in the nation for energy costs.”
Phelps is optimistic about St. Louis’ IT future and the quality of its personnel.
“You can go in and smell it,” he says. “There are world-class IT folks here. We’ve got some real hidden rock stars.”
