Dice Holdings, Inc. (DHX)
Deutsche Bank's DbAccess 21st Annual Media and Telecom Conference
March 04, 2013 1:40 pm ET
Scot W. Melland - Chairman, Chief Executive Officer and President
Previous Statements by DHX
» Dice Holdings Management Discusses Q4 2012 Results - Earnings Call Transcript
» Dice Holdings, Inc. Q4 2008 Earnings Call Transcript
» Dice Holdings Q3 2008 Earnings Call Transcript
But with that, I will just start off with kind of an overview question. Can you just talk about what you're seeing in the broader hiring market trends and any near-term expectations, specifically around sequestration? But could just get your overall view of the market for starters?
Scot W. Melland
Well, it's interesting. We're now starting our -- I think, our third or fourth year now into kind of a slow recovery, and so the labor markets in the U.S. -- I mean, actually around the world and developed part of the world, they're recovering, but they're recovering extremely slowly. When you look at specifically the verticals that we're in, they tend to be a bit stronger. So in technology, it's a good labor market today. It's a tight labor market but with very low turnover. And turnover is a huge driver of recruiting activity, so it's been artificially low now for a couple of years, and we'll see what happens with that in the future. Oil and gas, a terrific market today for us. And then financial services, still kind of a tough market, especially over in Europe. As far as sequestration, many -- as we talk to our customers, what they're telling us is that many of them expected something to happen, I guess, expected nothing to happen or something not so good to happen. And so they've been preparing for this really since fourth quarter of last year. So I think we've probably already seen the adjustments flowing through from the defense contractors and the government agencies, and you see it in our results. Our job count in Washington, D.C. is down year-over-year for the Dice service, and I think that's a reflection of what's happened with -- already with many of those customers pulling back recruiting activity because of sequestration.
Yes. And do you get the sense that -- I guess, they've already planned for this, and to the extent we do finally see a government resolution with the upcoming budget deadline and we get through that, that there might be some -- I guess, a pickup in activity if we get that visibility from the government?
Scot W. Melland
Well, I think, overall, we would expect, definitely, if there's some sort of solution, especially a long-term solution, they'll be very positive, I think, positively received by the whole business community and more willingness to take risk and make decisions. Uncertainty, a lot of people talk about uncertainty in financial decisions and how detrimental uncertainty is to financial decision. Same is true in a labor market. Anytime you're making a decision about whether to hire someone or open up a new office or fully staff a new office, any sort of uncertainty around your business or around taxes and what have you has an impact on that. So the uncertainty that they've created with the in rigmarole in Washington has taken -- has had an impact. So if there's any sort of solution or any sort of significant decisions that are made, it's going to help the labor markets overall. And so I think assuming something happens, the latter half of this year could be a better environment.
Yes, yes. And then just, I guess, is if we dig in a little bit on the tech side specifically, it seems as though particularly the Internet side of tech is doing well. What do you think it is that's holding back that turnover? Is it just the aggregate job market? People, whether it's the companies or the employees hunkering down? And what might change that on the tech side as far as getting that turnover higher?
Scot W. Melland
Yes. Definitely, withholding back on the turnover is the willingness of people to leave a position and take a new position and take that risk of jumping into a new position, which is driven by their view of the overall economy. If they think that the overall economy is still kind of iffy, they're not going to make that jump to a startup that may lose its financing or they're not going to make that jump to a division that who knows what's going to happen with that division. And so as we get further into recovery and as the overall economy and people feel better, one of the best things to look at, I think, for turnover is actually look at sort of what's going on with consumer behavior, consumer attitude because the more positive people feel about the general economy, the more willing they are to take that risk. So that's probably the biggest driver. Another factor in this recovery that could be holding down turnover, too, is that the practical matter of some people are probably underwater in their homes. So in the past, where they might be able to move to another location easily to take that great job opportunity, now they may not have that flexibility. And so that's holding back movement of talent between metropolitan areas.