Layoffs at Ground Zero

LOS ANGELES-Ground Zero is the latest shop to trim its workforce as a result of the slowing economy.

Jim Smith, president of the Marina del Rey, Calif., agency, confirmed that seven of the 78 staffers have been laid off in anticipation of a dip in revenues. “I think it’s tiny compared to what is happening in the rest of the industry,” he said. “I think we’re lucky. With a bit of careful management, we’ll be able to avoid the layoffs that are happening around town.”

Indeed, Ground Zero is not alone. Asher/Gal & Partners, Los Angeles, and a host of other midsized shops have reported layoffs since the new year. According to sources, industry behemoth TBWA\Chiat\Day, Playa del Rey, Calif., laid off about a dozen staffers at the start of the year.

The cuts come on the heels of what looks to have been a strong year for Ground Zero. It opened an office in New York and completed a $1 million facelift of its office in L.A. In August, the agency landed California’s five-year, $125 million anti-smoking account.

In addition, the shop has won a number of creative awards for its work on accounts including ESPN, the Los Angeles Times and Virgin Cola.

Still, the agency appears to be feeling the pinch of the economic downturn that is affecting agencies across California. Among the shops to sustain layoffs in the dot-com country of Northern California are Leo Burnett Technology Group, Publicis & Hal Riney, GMO/Hill, Holiday and McCann-Erickson/A&L. GMO was hit especially hard, having cut 30-40 staffers.

As a result, many West Coast shops appear much more circumspect about dot-com pitches.