It was only about a year ago that the American visual effects and computer animation business weighed in with other high-tech industries pressuring Congress to let them hire more skilled employees from overseas. There was heavy demand for high-end computer talent that far outstripped both the U.S. talent pool and the number of workers allowed in from overseas.
A lot has changed in just one year. Congress did lift the lid on the Immigration and Naturalization Service’s H-1B visas for such workers—from 115,000 a year to 195,000, for this and the next two U.S. fiscal years. But the real
change, as anyone dabbling in stocks listed on NASDAQ knows, has been in the companies that created the high demand for H-1B visa holders. Any number of Silicon Valley startups have vanished, and some of the biggest sponsors of H-1B workers—companies like Cisco Systems, Nortel Networks, Intel and Motorola—have cut staff and imposed hiring freezes. News stories on the Silicon Valley job market these days are about out-of-work foreigners facing deportation and an uncertain future. Halfway into the current fiscal year, it appears highly unlikely that the annual cap on H-1B visas will be reached (SHOOT, 3/23, p. 1). In fact, it would appear that requests for the visas aren’t even approaching the previous allotment of 115,000. That would seem to bode well for visual effects companies that said last year they were desperate for high-tech talent. It would, except for the fact that there have been some changes in their business, too. Regular clients are facing some real problems.
The filmed entertainment industry is looking at two possible strikes—by the Writers Guild of America (WGA) and the Screen Actors Guild (SAG)—that could be prolonged ones. At the same time, advertisers are spending more carefully in the face of an uncertain economy.
Effects companies are understandably leery of making the commitment in time and money to bring overseas workers here, and the laid-off talent from Silicon Valley generally lacks the skills to fill effects jobs. The larger players in the visual effects and computer animation realm are still recruiting overseas, while smaller operations, more exposed to short-term fluctuations in business, are taking a more cautious approach.
Digital Domain of Venice, Calif., recently let go 17 administrative and support people, but Laurence Plotkin, director of human resources and recruitment, says that the company is proceeding carefully in recruiting artists and computer talent, both here and overseas. "We are still involved in immigrating and we are still filling positions as our needs change when shows come in," Plotkin reports. "Although we don’t have huge shows in right now, we have several shows. We are still needing to move people around internally and, as usual, we see what holes we have and fill them with candidates. It’s not a hiring frenzy."
The number of international hires is down from a year ago, but Plotkin says that decline is a function of the company’s overall staffing needs; it’s not a change in the ratio of international hires to domestic hires.
"Our commercials division is currently looking overseas for visual effects supervisors—high-end commercial experienced talent that can build relationships with our clients," he states. "The immigration process seems to be going well. It is always a matter of a lot of effort on our part, and it is a time-consuming process. We’ve always had pretty good success with it. When we are in high gear, we look everywhere. We’re looking internationally, but just not in large numbers."
Industrial Light+Magic (ILM), San Rafael, Calif., also a major player in the effects business, continues to be an active sponsor of H-1B visa employees, with eight applications in the works now and about 70 H-1B employees on staff. A company spokesperson says ILM has about 500 animators, technical directors, software engineers, compositors, envelopers and digital matte artists currently on staff. A year ago, there were about 400 such employees, with about 40 on H-1B visas.
Question Of Need
For smaller companies, the project-by-project nature of their commercial and movie work makes it difficult to bring in overseas workers, and John Hughes, president of Rhythm & Hues Studios, Los Angeles, says that situation has only gotten worse in the last year.
"The industry has changed," he observes. "It’s much more project oriented. Right now, we can’t find enough people for a couple of projects we’re working on, and it’s almost impossible to use foreign workers to fill that need. That takes three months [in order to get a visa processed]. If we’ve been awarded a project that is going to last three to six months, and it takes three months to bring in the worker, it’s not likely we’re going to bring them in from overseas."
Hughes adds even though the new H-1B cap, coupled with the number of such visas that are still available, makes it possible to bring in more workers, the processing of the required paperwork hasn’t changed from what it was a year ago.
Part of the problem is that the studios bringing feature film business to Rhythm & Hues don’t allow the company to plan ahead and schedule new hires to meet the need. "The studios are not very forthcoming in awarding in a timely manner," Hughes notes. "They always tell us they’re going to deliver the negative really early; they’re going to be really efficient, so we can work on it quickly. It’s never true. If we actually brought in workers based on when production says they’re going to deliver negative to us, we would have scores of people sitting around doing nothing. So we can’t really hire the people until the negative arrives. And at that point, there’s no time at all [to go after an overseas worker]. We have to have the workers immediately."
And the commercial side, which comprises about 25 percent of the company’s business, isn’t any better in terms of turnaround time. "In growth terms, it’s fairly steady," says Hughes of Rhythm & Hues’ spot work. "But, again, the agencies are giving us less and less time to do projects. There are people on H-1B visas doing commercials for us, certainly, but the projects in that area are six or eight weeks, so when you get a project you certainly can’t take thirteen weeks to bring someone in on an H-1B."
About a third of the Rhythm & Hues staff of almost 140 is working on H-1B visas, Hughes continues. "As a percentage, there are far fewer than a year ago because it has become so project-oriented. We have to hire people at the last possible second."
At Ring of Fire Advanced Media, West Hollywood, the company’s sole H-1B visa holder recently returned to his native Spain, but co-founder/creative director Jerry Spivack says that when the company has positions to fill, it will look domestically and overseas for the right talent.
"If we see a reel from someone in the European market we want to bring over, the current situation makes it easier for us to pursue that," says Spivack, "but we can’t compare ourselves to a Digital Domain, which may have one-hundred fifty or two hundred animators on staff. They can’t deal with just the U.S. market. In our CGI department we’ve got about twenty to thirty people on staff. If we’re going to look for an animator or compositor, we always start looking at people we know, people we’ve worked with in the past. Then we expand upon that."
Spivack is content to have Ring of Fire stay a relatively small boutique, and he doesn’t anticipate extensive hiring, domestically or internationally, in the near future. "Our business is more a relationship type business where we work with the same people frequently," he reports. "If we were to get a new series that would require us to hire fifty more people, that might not be a project we would take on, because it would immediately take us out of our studio boutique mode and put us in a precarious situation when that job went away. We’re very cautious about what type of projects we take on."
But he doesn’t rule out the H-1B route for new hires. "It really depends upon the talent pool," he comments. "If we find someone in the European market, it’s now easier for us. It makes it easier for us to want to go for it."
A year ago, Chuck Richardson, senior VP/general manager of Blue Sky Studios, White Plains, N.Y., was one of the most vocal critics of the previous cap on H-1B visas.
But today, with Blue Sky out of the commercialmaking business and focusing on films from parent company 20th Century Fox, including the upcoming feature Ice Age, Richardson feels less pressure to recruit internationally. "We’re pretty much fully staffed right now," he says, "but when we look for people, we’re still looking for overseas people, and we’re still waiting for a few people to come through. If we wanted to do a substantial buildup, I don’t think we would have any choice but to go overseas. You have to mine every resource."
Blue Sky has about 165 people on staff, with about 10 percent on visas of some kind, reports Richardson. He would prefer to hire domestically because it’s less expensive, and he says that future use of H-1B visa holders will depend on the U.S. labor market.
One thing the visual effects executives agree on is that the current glut of out-of-work H-1B techies from Silicon Valley won’t help their situation. "The people we look for are mostly animators, and there aren’t many animators coming out of Silicon Valley," Richardson observes. Although they hasten to add that they look at former high-tech workers on a case-by-case basis.
Spivack says there may be some highly technical spots that Silicon Valley refugees could fill in the effects business, but not very many, and the potential for working in visual effects depends on background and the type of job being applied for. "Unless they specifically do postproduction visual effects, like compositing and animation, it would be difficult for a company like ours to hire someone like that. If someone has been designing word programs, it’s not going to carry over very well to visual effects and compositing. It would be a whole retraining in careers, basically," he explains.
"Our skill set is a combination of technology and art," Hughes adds, "and the people of Silicon Valley don’t have that skill set."
The executives surveyed by SHOOT did not seem all that concerned about the possibly pending strikes by the WGA and SAG, or the economy, but say they were proceeding cautiously in hiring.
Spivack says neither Ring of Fire nor the effects industry is in a belt-tightening mode, but rather, are proceeding cautiously. "Over the last six to twelve months, the industry has been hurt by a lot of different things—the actors strike last year," he says, referring to the six-month-long strike by SAG and AFTRA against advertisers. "For us, we’re just being very cautious. We’re a studio boutique. We’re hoping to add to our studio space this summer and get some more gear, but we’re not going to go out and hire thirty new people. Everything we do is very thought out, a slow process. It’s a cautious time."
Hughes echoes that sentiment: "We’re just very careful. Our percentage of freelance to staff has gone up dramatically. We have many more temporary employees today than we used to. We have a significant amount of work right now and we’ve been hiring for the last two or three months, but the projects finish up in May and June, so there’s no way we can go out of the country."
Digital Domain is also expressing caution. "We have a newly launched division, Digital Domain Solutions [DDS], that we are hiring for, but we need to be cautious and watch our pennies, as well," Plotkin says. (DDS is a convergent media shop involved in such endeavors as broadband, wireless communications, interactive TV and the migration of advertiser brands across varied platforms.) "We’re continuing to do good business and build our business," notes Plotkin. "We have concerns, but we’re moving forward cautiously, hoping for the best and making the best decisions we can with regard to the money we spend and the talent we bring in."
