Arnold Makes 3% Staff Cut

BOSTON Arnold has cut about 3 percent of its Boston headquarters staff, roughly 25-30 employees across all departments, sources said.

An Arnold representative declined comment.

The layoffs, per sources, stemmed from the agency’s sluggish new-business performance in the first half of 2006 as it struggles to regain momentum after parting with Volkswagen.

Worth approximately $400 million in billings, VW was Arnold’s largest account. It moved to MDC Partners’ Crispin Porter + Bogusky in Miami last December without a review. Arnold had worked on VW for 10 years, crafting the iconic “Driver’s wanted” campaign.

Last September, even before VW had left Arnold’s roster, the shop trimmed about 50 employees in anticipation of its departure.

The agency this week emerged as one of six semifinalists competing for the $150 million-plus Progressive Direct account [Adweek Online, June 27]. Arnold has, however, won no significant new business in recent months.