Fighting For Talent – What’s the answer to the ad industry’s recruiting woes?


It is a truism that an agency is nothing more than its employees. With few agencies actually owning intellectual property, their people are the reason they win and retain clients, win awards, and build a sustainable business.

However, this lifeblood of the agency is also its greatest threat.

Employee recruitment and retention are estimated to cost the advertising and media industry a whopping £184 million a year, according to the IPA Talent Adaptathon 2014.

The advertising and media industry has, of course, always been incredibly competitive, as agencies bid for that rare genius creative director they dream of to secure them the clients that will turn their business around, for example.

Agency heads have also long had to deal with the fact that the city will continue to skim off the best in graduating talent.

However, the digital revolution has also introduced a new threat – new giant tech brands from Facebook to Google to Apple offer the same promise of creativity but with salaries beyond the reach of most agencies. And the attraction of changing the world!

“The people we fight for talent are no longer professionals,” Ben Bilboul, managing director of Karmarama Group, said in a recent report by The Drum. “We’re competing with tech, startups, even their own startups — for those who aspire to be on the cover of Wired.”

So an eternal problem is only getting worse.

But let’s take a closer look at the £184m the IPA says is spent on recruitment and retention, as numbers like that can often make it difficult to understand what it might mean for you.

In a company of 100 employees, the average staff turnover is 20%, about 20 people per year leave your agency. Including direct and indirect costs, we estimate that it costs around £25,000 per year to recruit each replacement. Landing the business with a bill of £500,000 a year.

At the other end of the scale, companies with over 1,000 employees with a 20% turnover rate can face a replacement recruitment cost of up to £40,000 per employee. Resulting in a frankly terrifying cost of £8m to the company.

This may seem unlikely to you. This is probably due to the unrecognized and often forgotten indirect recruitment costs. The most obvious are start-up costs, interviews, recruitment agency fees, temporary cover, administration and training.

However, do not forget the often significant costs of lost productivity, staff remaining overworked, loss of knowledge, strained customer relationships, in addition to the impact of an employee asset being lost to a competitor. .

Again, let’s look at this in more human terms. The loss of a single account manager could quickly lead to the loss of critically valuable customers. In small agencies, a single new employee can represent a proportionately huge investment and risk, with the wrong choice having disastrous consequences.

So clearly we have a huge problem in this industry. The question is what are we going to do about it?

At the CAM Foundation, we want to understand the real issues facing the advertising and media agency industry in terms of recruitment and retention, and identify the market’s needs in terms of people and skills.

Only then can we determine what we, along with our parent the Chartered Institute of Marketing (CIM), can do to help.

We’ve launched a survey to dig a little deeper into all these questions and we’d love your help. So join us here and help us understand the real issues and challenges you and your business have with people, skills and recruitment.

We’ve been on a mission to support the agency ecosystem since our inception in the 1970s and we need your help with our next step, so get involved!

Alaina Roberts CAM Portfolio Manager, CIM

Collective Intelligence Catalyst


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