IBM’s Baton Rouge Office Is on the Right Track, Officials Say

The company offered a rare glimpse into its Louisiana office after striking a deal with the state in 2017. IBM officials say the center is trending in the right direction when it comes to hiring a local workforce.

by Sam Karlin, The Advocate / February 21, 2019

(TNS) — IBM held the doors of its taxpayer-financed downtown Baton Rouge office tower open to the public Wednesday, offering a rare look into what the technology giant has been doing since inking an economic development deal with the state nearly six years ago.

The "open house" came as IBM approaches a summer deadline for hiring 800 employees as part of a revised state deal struck in 2017. Charles Masters, IBM vice president for North America client innovation centers, also offered some answers to questions about the firm's hiring practices, salaries and recruitment efforts related to that deal, saying the company is seeing "significant growth in quality jobs."

Masters declined to specify how many employees currently work at the client innovation center. But he said the company will have hired 125 people in the first quarter alone. The firm has held multiple hiring events in recent months and increased referral bonuses to employees.

"We are absolutely trending in the right direction," Masters said of the hiring quota.

About half of the workers at the Baton Rouge center are from out of state, he said, though all move to the region when they are hired. He fought back against concerns the company has paid low salaries, saying all new hires start at "over $40,000," and the average salary at the center is $58,000 a year. He also said the H-1B Visa program, where companies can hire skilled workers from overseas, represents "1 or 2 percent or less" of the workforce there.

"We’re not doing call center work. We’re not doing stay-up-all-night programmer maintenance work," Masters said. "We’re literally solving the most complicated things out there. The cool things you see IBM is doing on TV … Those are the kinds of things we’re doing."

Spokeswoman Sarah Minkel said later average starting salaries for "new professionals" range from "the mid $40,000s to the mid $60,000s." She also noted H-1B visa workers are not counted in the job figures with the state.

Former Gov. Bobby Jindal first struck the deal with IBM in 2013, hailing it as a "game changer" that would help diversify the state's economy. As part of the deal, the state and East Baton Rouge Parish offered an incentive package of nearly $147 million over 17 years in exchange for the firm creating 800 jobs, along with the government-funded office complex on Lafayette street downtown.

But IBM failed in 2017 to reach that target. It had only 572 jobs at the time of the deadline, with some of those allowed to be stationed in Monroe, where it has another center dedicated to servicing CenturyLink.

Instead of cancelling the deal, Gov. John Bel Edwards renegotiated the agreement to give IBM more time to meet its job targets. The new deal gave IBM until June 30, 2019 to meet the original promise, and instituted a $10,000 penalty for each job it falls short.

Masters on Wednesday offered the first public explanation by the company of why it missed hiring targets as part of that deal in 2017. He said the company had trouble finding talent at the time because of the 2016 floods and a lagging pipeline of local students.

"There was a period of time where the talent part of the equation, finding people we could hire who were local, there was a flood, there were various issues," he said. "In the beginning LSU was only having a little bit of computer science people."

IBM is getting close to hiring its 300th LSU student, he added.

New hires are coming from not only LSU, he said, but also Baton Rouge Community College and throughout the country. Many are straight out of college, while others are professional hires, including out-of-state recruits. One recent new hire came from the University of Hawaii, Masters said.

Employees at the event held demonstrations and gave presentations on its technology and community initiatives. Metro council members and even Congressman Garret Graves took a tour, learning about things like the company's "cloud garage," automation and AI/big data divisions.

The company services a wide range of industries, with employees showing off tech used in the automotive, retail, banking and telecommunications industries, among others.

©2019 The Advocate, Baton Rouge, La. Distributed by Tribune Content Agency, LLC.

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