Recession for ad agencies?

So, we had one days breather from the recession doom and gloom, soaring energy prices and job losss and today, the press get back to normal.

Whilst driving home tonight Radio 1 reported that 50% less new cars were produced this month (year on year), Microsoft were reducing jobs by 1,400 worldwide and reebok  are moving out of Bolton – causing 100’s of job losses.

Yet my daily dose from WARC informs me that the UK ad industry has never seen such strength:

Across the IPA’s 272 member-shops, the combined payroll totalled 20,131 staff – the highest in forty-eight years and one thousand more than in September 2007.

Whilst the news may seem positive the article doesn’t seem to think this may be an upward trend: Hamish Pringle, the IPA director General thinks that “we expect 2008 to be the year that is remembered as a peak year for agency staffing levels.”

With marketing budgets in no doubt starting to feel the strain as companies start tightening their belts its doubtful the industry wont continue to see casualties across 2009. Yet whilst agencies will see staff levels cut will clients appreciate the leaner agency? Those who may have been over serviced by more account staff and specialists pampering them will see agencies going back to leaner staffing structures and more efficient processes. The challenge for agencies will be managing and not neglecting the clients that remain strong (and may not be cutting budget) with those very clients left with a slightly different agency to that they signed up to or got used to across 2007/08.

It will be interesting to see how agencies, and clients, cope with the changes that are inevitably to come…. Lets just hope disruption is minimal and the economy surrvives with as fewer casualties as possible.

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Posted on January 22, 2009, in Think Digital and tagged , , , . Bookmark the permalink. Leave a comment.

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