A Meeting to Remember

    Denis Martin, executive vice president of NaviSite, and Arthur Becker, the firm’s chief executive, had come to the home of the U.S. Labor Department to make their case that the free public job site should be allowed to continue in some form. Massachusetts-based NaviSite had managed the technology behind America’s Job Bank for more than a decade. Martin, in fact, played a role in the initial design of the site based on his work with a predecessor system. In addition, NaviSite’s contract to manage the site accounted for roughly 5 percent of the firm’s annual revenue of nearly $110 million.

    As a result, the two executives were concerned about the Labor Department’s recent announcement to phase out the site at the end of June 2007. In particular, they hoped to persuade Labor Department officials to give away or sell the assets of the site. Becker and Martin wanted NaviSite to be able to keep operating the site in the private sector, preserving the site’s brand and significant Internet traffic.

    So on August 8, they entered a conference room along with others including Emily DeRocco, who is assistant secretary of labor in charge of the Employment and Training Administration, the Labor Department division that oversees America’s Job Bank.

    In mid-March 2006, DeRocco had sent an e-mail to state officials announcing the decision to close America’s Job Bank. An attached memo laid out the rationale: "Numerous factors were weighed in coming to the decision to end AJB, most of which fell into two broad categories: 1) changes in the broader environment AJB is operating in and 2) the costs associated with running the system."

    But on this August day, Martin and Becker say, DeRocco introduced another factor. The executives say that during the meeting, DeRocco spelled out various reasons for phasing out America’s Job Bank. But, they say, the primary reason for her was that there wasn’t any proof that people landed work as a result of using America’s Job Bank. Martin recalls DeRocco saying, "Most of all, we’ve never had any evidence that people got jobs through this thing."

    The Department of Labor declined to respond to questions about the August 8 meeting.

    But Kris Balderston, an aide to Sen. Hillary Rodham Clinton, confirmed the meeting took place and that he attended it. Asked about Martin’s account of DeRocco’s main reason for closing America’s Job Bank, Balderston said he does "not remember the details of the conversation at that level."

    If what Martin and Becker remember of DeRocco’s comments is true, her statement about a dearth of evidence is contradicted by internal Labor Department research about America’s Job Bank. A 2002 report titled "America’s Job Bank: Outcome Study" found that 10 percent of the job seekers tracked found jobs directly through the site—which extrapolates to 345,000 over the course of a year.

    The study also found that 4 percent of job openings on America’s Job Bank were filled through the site. That rate was significantly lower than the 15 percent rate found at Monster but not far from the 6 percent rate at HotJobs (now part of Yahoo).

    A former senior Labor Department official says DeRocco received the report.

    The Labor Department declined a request for a response from DeRocco to the charge that her alleged comments contradict the findings of the America’s Job Bank outcome study.

    At the August 8 meeting, Martin and Becker were not aware of the outcome study, they say. But they knew America’s Job Bank had long enjoyed significant use and Web traffic. The site holds some 2.2 million jobs, along with more than 600,000 résumés. An average of 1.9 million unique visitors came to America’s Job Bank each month for the first five months of 2006.

    Partly as a result of the August 8 meeting, Martin believes there was no truly open-minded study of the site. "I think they went into it with the sentiment that it didn’t need to exist, and it was a self-fulfilling prophecy at the end when they determined that it didn’t need to be funded," he says. Martin also says he’s certain the Labor Department did not produce a comprehensive report looking at the pros and cons of continuing AJB.

    The Labor Department declined to comment on Martin’s statements.

    As it turned out, DeRocco and other Labor Department officials decided not to give away or sell the site. In a statement, the Labor Department said it "is prohibited from using the assets to the advantage of any private-sector entity. In addition, [the Department of Labor] cannot give or sell the assets to the private sector unless there is an express public purpose."

    NaviSite has since announced a product intended to replace America’s Job Bank. The firm’s America’s Job Exchange is one of at least two private-sector efforts to duplicate the site’s services. But things would have gone much smoother if the Labor Department had agreed to NaviSite’s request, the executives maintain. It’s possible, they argue, that America’s Job Bank’s shoes will never be filled.

    In their view, the blame lies largely with DeRocco and the attitude she revealed that summer day.

    "I think there’s nothing wrong with" privatizing America’s Job Bank, Becker says. "She’s seen fit to go out and destroy it."

Workforce Management Online, July 2007 -- Register Now!