Today in Absolutely Not Breaking News: Last month Entrepreneur posted a good piece about how the PR/ad agency model is “ripe for disruption” as creative folks and resourceful managers figure out how to best serve clients outside the traditional framework. Two lines in particular stood out to us:
“Nobscot Corp. estimates voluntary and involuntary turnover reached more than 55 percent over the past 12 months.”
That is a large number. Also…
“According to the Bedford Group, client/agency tenure has shrunk from more than seven years to less than three years.”
As a 2013 post from Ogilvy Australia tells us, high turnover is the “quickest way to the bottom“. But you already knew that. It’s true that agencies aren’t the absolute worst: that honor unsurprisingly goes to retail, restaurant and hospitality businesses. But we’ve covered both PR and advertising long enough to know that the length of the average agency employee’s stay is almost shockingly brief–and it won’t be increasing any time soon.
A basic fact about that whole “turnover” thing (though numbers do vary):
- “…the cost of losing just one key employee may exceed 60% of the departed employee’s annual compensation due to training time, lost productivity, and other factors.”
On the PR side, from a 2007 study:
- Average yearly turnover across all specialties is 20.5%
- 49% of firms report turnover rates between 10-30%
- 24% of firms have rates higher than 30%
These numbers aren’t quite the 55% reported in Entrepreneur, but if anything they’ve grown more relevant as the traditional agency model continues “evolving” or unraveling and top talent grows more valuable by the minute.
It’s not just us. These numbers are for Hong Kong in 2013 (agencies in yellow, food and beverage in purple):
A top PR executive we spoke to this week noted that the single most challenging part of his job is (and has always been) finding and signing great talent–a challenge exacerbated by increasing turnover.
And so, readers, we’d like to start a conversation here: how high is the real turnover rate in PR, why is it so bad, and what do we need to do about it–both within firms and as an industry?
Feel free to use the anonymous comment box, and be as honest as possible. We crave your feedback more than we crave this post’s delicious pastry.