Ad agency succumbs to downturn with job cuts

Until now it has been the stalwart of London’s ad agency circuit, but Bartle Bogle Hegarty has finally succumbed to the industry’s malaise and made 10% of its UK staff redundant.

Forty full-time workers, who have already accepted a pay cut, will be shed from the agency’s office in Kingly Street, which serves as its European headquarters to a host of ‘A-list’ clients.

The cuts, which the pay reductions were deployed to avoid, will reportedly affect staff across all departments and all seniority levels over the next six to eight weeks.

In an internal meeting, staff were told the redundancies were necessary as the drop off in ad spend had “accelerated and radicalised” the need to trim and restructure their ranks.

But senior managers stressed they tried to stave off the layoffs months ago with a 3.5 per cent pay cut, a move they said would now be cancelled for anyone made redundant with those people being offered the money back.

And while the restructuring was not new, BBH added, it had been brought forward on the back of a decline in client revenues, which the managers cited as an “industry-wide” problem.

The comments will be seized upon as a fresh indicator that, in the current climate, agencies are equally as prone as freelancers to feel the pinch of client belt-tightening.

For those staying at BBH, the upside of the restructuring is that it will emerge as a “fitter” and “more dynamic creative business,” said its chief executive Ben Fennell.

His agenda includes building a “more broadly skilled creative function”, led by technology, to complement prior investment in digital and brand invention, the Guardian reported.

To this end, the agency said it had recruited 20 new professionals this year alone to work on projects for clients, who include British Airways, Lynx, Britvic and Audi.

At the time of writing, a spokesperson for BBH said the agency was working to assess whether its cutbacks would have, or have had, any affect on its freelance workers.

 

26th August 2009

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