The news: Advertising and related industries lost 8,700 jobs in September, a sharp reversal after summer growth and the biggest loss for the category since January 2021, when about 6,000 jobs were cut, according to monthly figures from the United States Bureau of Labor Statistics.
One goes up, the other goes down: Total employment rose by 263,000 last month, making the heavy losses in advertising particularly notable.
- The last time advertising jobs fell as overall jobs picked up was in May, when jobs have fallen by 2,400. Those losses rebounded through the summer, and additions hit an all-time high in August.
- The September losses followed a summer of relentless ad revenue declines, agency layoffs and marketing team cuts in industries closely tied to advertising. Discovery of Warner Bros., LinkedInand some automakers have all streamlined their marketing teams in recent months.
- Geicothe decision to lay off most of its marketing staff Last week and putting his media account under scrutiny is a sign that more layoffs from other insurers and stalwarts of advertising spending could be on the horizon.
The economy puts pressure on advertising: Rapidly rising inflation was a hot topic throughout the year, and although consumer spending remained relatively stable despite thisindustries waited nervously for the other shoe to drop.
- The Fed’s response to runaway inflation has been to raise interest rates, which in turn has dampened business spending and eased the historically tight labor market. The second half of the year was ripe with announcements of layoffs and hiring freeze in Big Tech companies and other industries Therefore.
- All of this means less money to spend on advertising, and the effectiveness of what’s left is in question since consumers may not be willing to spend enough to make companies’ advertising investments pay off.
It’s not all the economy’s fault: A faltering economy does not change the fact that advertising goes through several crises on its own initiative.
- Firstly there is privacy. The federal government has set one’s sights about the advertising industry’s data collection practices, sue ad agencies for actions that many consider common practice. These actions were particular examination after the dismissal of Roe vs. Wadewhen ad data was used by law enforcement to charge women seeking abortion care.
- Applesound removal Identifier for advertisers and the implementation of opt-in ad trackingas good as imminent deletion of third-party cookies on Google Chrome (the most popular web browser) have also thrown digital advertising into chaos. Companies like Meta who tried to circumvent these changes landed in legal hot water.