Omnicom-owned, San Francisco-based full-service agency Goodby Silverstein & Partners went through a round of layoffs this week, the agency has confirmed, as the agency’s revenue from new business and existing client relationships appears to have not kept pace with costs over the past several months. The layoffs impacted less than 5% of the agency’s employees, according to sources with knowledge of the agency’s operations.
“Over the past few months, you’ve heard me talk about the relationship between revenue, from new and old clients, and its relationship to our costs and expenses. A healthy business needs to always have these things in balance, or at least have a reasonable plan to get back into balance. After a year of amazing success walking this tightrope, I’m afraid that we had little choice but to lay off some of our fellow staff members,” GSP partner, president Derek Robson said in a statement to employees in a staff meeting yesterday.
“This kind of decision is not taken lightly and is obviously wrenching, but we have learned that it must be done for the continued health of our larger mission,” he added. “The people leaving will be cared for, and as always, we will help them find a way forward.”
The latter statement appears to suggest the agency is providing some form of benefits to the employees impacted by the decision, although the extent or duration of this is unclear.
The layoffs arrive around four months after GSP’s decision to open a new office in New York after growing operations in the area, around five years after closing an office in the city. GSP’s decision to lay off employees was not related to any client losses and the agency managed to bring in 14 pieces of new business last year, according to sources with knowledge of the agency’s operations. While most agencies went through rounds of layoffs in 2020, GSP had avoided such measures until now, according to these sources.