Claire Beale: Say it quietly, cuts in adland are not always bad

Monday 06 April 2009 00:00 BST
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I know we're supposed to be lamenting the sad human cost of recession: all those people whose lives have been thrown off course by losing their jobs. And it is sad. Even though it happens to the best of us. So while I'm on the subject, I'd like to refer you to adland's excellent charity Nabs, which advises and supports ad execs who have fallen on hard times. Give generously while you still can: nabs.org.uk.

But the fact of the matter is that adland's redundancies have been cleansing. Ask agency chiefs who have been culling staff whether – if they could do so tomorrow – they would rehire the people they've just let go. Oh, I've been asking. And the answer, always – so far – is a rather embarrassed but determined "no".

Adland has been cutting the fat. It has not – yet – had to cut the muscle. In losing jobs, many agencies have gone through a rather healthy and even overdue detox. And the advertising mandarins are really more than comfortable with that.

Which is not to say that the people who have been made redundant so far aren't any good. You have to be really, really good to get into this business. And you have to be even better to survive for any length of time. But plenty of those who have been let go weren't necessary any more and there's little point pretending that many companies haven't emerged leaner and fitter after the recent purge (just as there's little point pretending that when times were good, agencies were often poorly run businesses that tolerated flabbiness). "Don't waste the opportunity of recession," say the optimists. So let's be positive about job losses.

And then there's Bartle Bogle Hegarty, which has decided to take a wholly different approach. Let's try really hard not to make anyone redundant, is the BBH strategy. Last week, the agency asked its staff to consider taking an extra nine days' unpaid leave. Apparently this is the equivalent to an average 3.5 per cent pay cut. And it's also been offering staff voluntary sabbaticals of up to six weeks in length. All for the greater good: keeping Team BBH together.

The first thing to note from this strategy is that clearly BBH has no fat it is itching for an excuse to cut. And it's looking for a more creative way of saving money than losing talent. As one of the best, and best-run, agencies in town, and one that reputedly pays only modestly for the top talent clamouring to work there, we shouldn't be surprised.

It's true that unpaid leave is not a new idea, though it's the first time in this recession that a big agency has tried a bold alternative to redundancies. And it's true that, on the surface, it seems likely disproportionately to affect staff on lower salaries.

Yet BBH is on to something of wider relevance. Because the harsh truth is that agencies won't be able to get away with simply cutting out the fat. Figures released last week show that the worst is far from over. According to media buying giant GroupM, UK adspend will fall by an eye-watering 11 per cent this year. There's plenty more economic pain to come and service and product will be compromised if agencies don't find creative ways to cut costs beyond culling dispensable staff.

Perhaps the real challenge, though, will come when the economy picks up and agencies start to enjoy better finances, though it's doubtful that the industry will ever claw its way back to the boom levels of a few years ago.

Staff that have been asked to share the corporate pain will then expect to share the gain and they'll expect a new sort of loyalty from their agency employers. All of which could also prove a healthy readjustment for an industry that, recession or not, lives and dies on the quality of its talent.

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