Staffing Status: Employment News Not All Bad

The Chicago ad agency employment base is eroding as fast as the Lake Michigan shoreline after a stormy summer. But in Minneapolis and Detroit, despite similar economic circumstances, agencies have added staff during the past year and a half, according to an ADWEEK poll.
Thirty agencies in Chicago, Minneapolis and Detroit provided ADWEEK with staffing level changes between Jan. 1, 1992, and July 1, 1993. If the numbers can be believed, agencies’ staffing ‘depression’ is a Chicago problem more than a regional epidemic. While the numbers show a 9.4% drop in employment among major agencies in Chicago, the number of jobs in Minneapolis grew 8.7% during the period and rose 5.6% in Detroit. Nationwide, total employment at advertising agencies increased 1.1% over that period, according to the U.S. Bureau of Labor Statistics.
‘I’m surprised Chicago isn’t down more,’ said Peter Krivkovich, president, Cramer-Krasselt/Chicago. ‘And I’m surprised Detroit and Minneapolis aren’t down also. Everyone is downscaling and dealing with decreased margins in the business. The industry is like a rabbit that’s gotten caught in the headlights: it’s frozen.’
In part, the disparity in the three markets’ numbers reflects the drought in new business Chicago has experienced, compared with other ad centers. Other observers suggest some agencies’ increases are illusory, masking replacement of highly-paid veterans with younger, cheaper talent or accounting for addition of more technical support jobs.
But Chicago agencies are running lean. Terms such as ‘downsizing,’ which indicate a one-time cut, have given way to the current popular euphemism ‘decruiting.’
‘Most agencies are only hiring when they absolutely have to,’ said one local headhunter who declined to be named. ‘But the job market in Chicago, especially at the more experienced levels, is tighter than anywhere else. We place far more Chicagoans out of this market than anyone would believe.’
‘Running lean is the new reality,’ said Foote, Cone & Belding/Chicago evp/managing director Mitch Engel. ‘Budget cuts have been such a part of our lives for the past five years that I think people have been wary of permanent hires.’
‘We are busier than ever, but we are trying to do it with as few people as possible,’ said Lee Lynch, chairman/ceo, Carmichael Lynch/Minneapolis, which has kept its staffing fairly steady. ‘We’ve become so heavily computerized that we are able to do more work with fewer people.’
And while agencies resist new hiring, the number of applicants is higher than ever.
‘We got more than 3,000 resumes last year and maybe we hired 20 people, most of which were replacement hires,’ Lynch said.
Few feel the employment outlook is bright. Several local headhunters recently told a Chicago art director that they would have to send his book out of town because there were so few jobs available and no expectation that conditions would change. Minneapolis and Detroit shops are cautious also.
‘Employment will remain rather static over the next year and a half to two years in Detroit, with a chance that it will pick up after that as the domestic car business picks up,’ said Lintas:Campbell-Ewald chairman/ceo Richard O’Connor. ‘But it won’t be what it was five and ten years ago.’
Table shows employment at various midwest agencies.
Agency 1/92 7/93 % +/-
Leo Burnett Co. 2383 2253 -5.5
DDB Needham 575 471 -18.1
Foote, Cone & Belding 455 460 -1.1
Agency 1/92 7/93 +/-
Lintas:Campbell-Ewald 668 616 -7.8
J. Walter Thompson 387 445 +15.0
W.B. Doner 269 284 +5.6
Agency 1/92 7/93 +/-
CME-KHBB 472 471 +0.2
Fallon McElligott 151 171 +13.2
Carmichael Lynch 163 160 -1.8
Source: Individual agency data
Copyright Adweek L.P. (1993)