At least 150 staffers are being dismissed by some of the region's largest agencies, which find themselves constrained by client budget cuts and the relative lack of new-business opportunities.
Last week signalled a a new low, industry watchers said, as Boston'sDigitas announced a round of layoffs, cutting about 120 employees, and crosstown shop Holland Mark confirmed that 12 people were cut in the agency's third layoff in recent months.
Fidelity Investments' parting Friday with Hill, Holliday, Connors, Cosmopulos, also Boston, will generate cuts as the agency winds down its relationship with one of its largest accounts, according to Hill, Holliday representative Eric Fehrnstrom. Boston's Arnold might hire some of those staffers should the agency, as sources predict, add a significant portion of Fidelity, but as of press-time on Friday, such a scenario had yet to materialize.
"I don't think you can get much lower," said consultant Bill Montbleau, who maintains that the current economic climate, from an agency standpoint, is more dire than the recession of the early 1990s. That recession took several years to peak, but the current downturn has been especially sharp and swift, Montbleau said.
Digitas, which had earlier cut 65 people, will by month's end have reduced its global workforce about 10 percent to 1,700 since the year began. David Kenny, CEO of Digitas, said last week the agency expects second-quarter revenue of $60-63 million compared with the $70-74 million originally projected. Kenny attributed the slide mainly to spending cuts by financial clients.
Digitas is talking with the Interpublic Group of Cos. about an acquisition or affiliation. The lighter payroll may make Digitas more attractive, but Montbleau warned: "You don't want things to get too shabby and people to get too dispirited or you're left with a shell."
A "significant" ad budget reduction by EMC has resulted in "a few cuts" from the Arnold team on the account, sources said. An Arnold representative maintained that no cuts are being made.