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The Career Center

Company specializes in off-hours training.

Since 9/11, the economic news has been all about scaling back. But one Manhattan company decided to take a risk, and it’s paying off for them.

The Career Center is a computer training company with about 90 instructors. It began as a division of a computer consulting company called Genesis in 1988, but spun off into its own business in 1992. The Career Center offers classes in networking, database management, office applications, certifications, and more.

Career Center classes are available during the week, although their most popular classes are offered in the evenings and on weekends. Most of their students are people who are already employed but want skills for a better career. Others are the recently unemployed, and still others come from corporations sending their employees.

Last spring, when the economy began to slow, the computer training industry was among those earliest affected. Then 9/11 took the wind out of everybody’s sails. The sudden shift from a great economy to a poor one was especially hard on the city that endured the most destruction. “It’s been very tough for people in New York,” says Mark Steinberg, president of the Career Center.

Since then, the computer training industry has been changing. Many schools have gone out of business, and the remaining schools have limited their operations. “Most of our competitors just saw this as bad luck, and they retrenched and cut back,” Steinberg says. “We took the opposite approach.” That approach was to cut prices by 25-30 percent, advertise more aggressively than anyone else, start offering more loan options to customers, and get involved with the Workforce Investment Act (WIA) program. Steinberg says that the strategy has paid off. “As we come out of this thing, we’re going to be more dominant than we were before,” he says.

The strategy was a risk for the company. With a down payment, students could get zero-percent interest on loans, and in some of the offered loan programs the Career Center would take the loss if students defaulted. Similarly, under the WIA program, the government pays for unemployed or “dislocated” workers to be retrained. The Career Center gets some money up front, but they’re only paid in full when the student gets a job. Career Center offsets their risk by working hard to help students find jobs. “The quality of our training and our efforts to help them find jobs means that they can find jobs and pay back their loans,” Steinberg says. “It’s a risk, but we do it, and it’s working.” The default rate on the loans, he says, is not more than 5 percent.

How have they thrived while cutting prices? In part, it’s a question of volume. By ordering class materials in bulk, they save a lot of money compared to their competitors. By using automation in every aspect of their operation, Steinberg says, they can run a larger operation with fewer staff than comparable businesses use. They also target their advertising more effectively by tracking where people hear about them (radio, TV, the Internet). “40 percent of our referrals come from the Internet,” says Steinberg. “We also get good press from former students.” The key is using a business approach to offering education, rather than focusing only on education.

Most of the Career Center’s business comes from individual students, so classes are tailored for people who are spending their own money and want to get the most mileage out of its investment. But the weaker economy meant that corporations were more interested in saving money, so the Career Center turned the weaker economy into a strength, targeting corporations with its “Suddenly Price Matters” advertising campaign. The campaign emphasized the Career Center’s ability to offer the same services as national, more expensive training companies, for less money. Since the campaign began, Steinberg says, their corporate business has actually gone up. “If you offer something people consider a value, you’ll be successful,” Steinberg says.

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