Media Buying Agencies Hiring Soon?
November 16, 2009 | 10:45am
In my previous blog I talked about the economic cycle and indicators of a recovery. One thing we noticed in our third quarter survey of media buying agencies was that while the economy shows signs of improving, hiring by media buying agencies remains stagnant. Of those polled, 82.5% said they plan on keeping their staffing the same for the rest of the year. One interesting thing was that for the first time in a year, less than 10% in our survey said they will add staff. That is a 56% decrease from a year ago. With fewer employees, many agencies are purchasing advertising that is easier to produce and purchase. That’s one of many explanations to the strength of Radio and Internet advertising in our latest poll.
This week the news was full with headlines that the nation’s unemployment rate rose above 10% for the first time since 1983. According to Bernard Baumohl, Chief Global Economist for The Economic Outlook Group*, “October’s 10.2% unemployment rate was unnerving to be sure. Our new forecast calls for it to inch up to 10.5% by early next year. But this rise does not quite reflect the promising shifts underway that will lead to more job creation and lower unemployment by mid-2010. Employers are beginning to reassess their staffing needs now that a recovery is taking shape.”
Media buying agencies will continue to look for cost saving measures at least through the end of the year and into the first quarter of next year. With that in mind, when will we see agencies returning to a strong growth period? In our recent poll, the answer of “Not until late 2010” received the largest response at 35%. Over a quarter of our respondents were targeting early 2010 though. So some optimism of a recovery is out there. Clearly when there is an increase in business, the need to increase staff will soon follow. The Media buying agencies with the biggest advantage are those who can buy the most without increasing staff. High productivity through better processes and tools will be the difference between winners and losers in 2010.
*The Economic Outlook Group, http://economicoutlookgroup.com/ETP11609.pdf