Tighten your belts

With recruitment freezes, pay cuts and a reduction in the use of freelancers, the Carlson salary survey makes sobering reading.

<b>Average salary in 2001 compared with 2000</b> Average Salary in 2001 (£) Average Salary in 2000 (£) <b>Account Handlers</b> Account Executive 17,400 16,940 Senior Account Executive 19,060 19,220 Account Manager 24,330 23,500 Senior Account Manager 30,210 28,050 Account Director 39,250 37,630 Group Account Director 50,110 53,000 <b>Creatives</b> Graduate Creative 17,500 15,290 Junior Copywriter 17,590 19,940 Junior Art Director 17,630 18,950 Mid-level Copywriter 29,750 27,950 Mid-level Art Director 25,830 27,790 Senior Copywriter 45,920 41,250 Senior Art Director 45,320 41,150 Creative Head 63,000 57,370

Average salary in 2001 compared with 2000

According to Carlson Marketing Group’s latest salary survey, conducted among 12 DM agencies, a third of companies have, or will institute, a recruitment freeze and a quarter have, or will introduce, a salary freeze. Just one in ten companies have made annual salary increases in line with inflation.

However, the survey results aren’t all doom and gloom. Although salaries are now likely to remain static, they have been steadily increasing for the past few years. Since 1997, the average salary of an account handler has risen by 33.5 per cent and creatives have seen a rise of 32 per cent. In 2001, the winners were graduate creatives, who received salary increases averaging 15 per cent, senior account managers (up 7.7 per cent) and creative heads (up 9.8 per cent). The losers were junior creatives – salaries for junior and middleweight art directors fell by seven per cent. Among account handlers, group account directors’ salaries suffered the biggest fall – 5.5 per cent – but otherwise account managers did, generally, get pay rises.

Carlson managing director Steve Grout believes that account handlers have generally fared better than creatives simply because creatives’ pay increases were larger the previous year: “My guess is that this is also a hangover from the skills shortage of late 2000 and early 2001, which forced some salaries upwards.”

Overall, creatives still earn more than account handlers. The gap is widest at the top, with creative heads commanding £63,000 (up 9.8 per cent) compared with an average salary of £50,110 (down 5.5 per cent) for a group account director. But judging earnings on salaries alone is misleading, as account handlers continue to be more likely to get a bonus or another type of benefit, although since 1997 the number of account executives receiving bonuses has halved to 30 per cent. Higher up the ladder, three-quarters of account directors receive a bonus, nearly 20 per cent more than senior creatives.

Carlson personnel development director Francine Brooks believes this will change, as creatives become more demanding: “Benefits packages are always going to attract people, and in the past we have found that account handlers demand a much higher level than creatives. But the survey shows that creatives are starting to want a similar package to account handlers.”

Agencies are moving towards offering more flexible benefit packages. Cars are becoming less popular, even among account handlers – just over a third of them have one, compared with 11 per cent of creatives – and there is a strong trend towards accepting cash instead. Marketing Store commercial director Jim Patterson believes that cars are losing their appeal due to the increasing tax burdens. He thinks that it is worth considering other benefits instead, as “companies can no longer compete on salary alone”.

The survey suggests that employers are becoming more innovative in their use of bonuses and incentives, often letting employees with different needs pick and choose their allowances. Brooks believes that, as UK employees clock up such long working hours, it is also important to encourage a good work-home balance: “We need to tell people it’s okay to go home. Exhausted staff don’t produce great work. It is a dreadful cliché, but we need to learn to work smarter, not harder.”

Put yourself about

As far as investing in staff for the future goes, although graduate salaries are rising, the number of graduate vacancies has dropped by 5.5 per cent over the past year. Ian Millner, founding partner at youth specialist agency Iris, offers tips for graduates determined to break into agencies: “They should try to find placements, spend time in agencies and get to know different environments before they make the leap into full-time employment.”

He adds that traditional graduate recruitment is flawed, because people coming straight from college do not really understand the commercial aspects of the business, and all tend to think in similar ways. He says: “What we really need to look for are people with social intelligence, common sense and great ideas. People who think as individuals and who don’t naturally conform to the ‘square peg, square hole’ milk-round stereotype.”

Another change in today’s market is the attitude towards freelance staff. In the last recession, agencies used freelancers to make up the numbers, but EU legislation has made freelancers a less attractive choice. OgilvyOne Worldwide management partner Mike Dodds comments: “Freelancers are no longer such a flexible option. This will mean that we will probably see a greater focus on stretching full-time staff to manage peaks and troughs.”

Cramm Francis Woolf managing director Paul Woolf is particularly irritated by how legislation cramps agencies’ ability to be flexible: “In the past, agencies could hire freelance staff for up to a year without having to provide employee benefits; this will change. The EU directive means fixed-term contract staff working for an agency have full employee rights, including holiday and sick pay, from day one. The fine for failing to provide full employee rights has been increased to £50,000 from £10,000.

“It doesn’t take a genius to work out that many agencies will avoid these problems by discouraging the use of freelance staff, thereby encouraging a ‘hire and fire’ attitude towards existing permanent employees. In addition, the practice of evaluating freelance staff as prospective full-timers will quickly disappear.”

Dodds believes that the needs of businesses and their clients will ultimately determine to what degree freelancers are used, and also ensure that they will pay lower rates: “Historically we have seen inflated daily rates, which has been partly a result of the lack of benefits enjoyed by freelancers in comparison with their permanent counterparts. However, as those terms and benefits become more aligned, we are likely to see rates of pay stabilise, or even reduce.”

Invest for success

Last year’s survey reflected a shortage of DM staff with good skills and experience, largely because the recession of the early Nineties led to drastic cuts in training budgets. This year, although agencies’ main priority is to keep their heads above water, those who survived the last recession appreciate it is vital to continue to invest in marketers who will be able to meet increased client demand in the future. Some agencies are making training budgets go further by finding cheaper ways to develop staff. For instance, Woolf says that his agency is focusing on internal training rather than paying extra for external courses.

Woolf says that training is vital for holding on to staff, and adds that he believes “too many agencies at the moment are being short-termist when it comes to staffing”. But assuming that agency chiefs do manage to keep a cool head and retain a long-term view, Marketing Week does not expect to report on another skills shortage in ten years’ time, caused by panic-driven personnel policies today.

Methodology

This year’s is the fifth annual salary survey, covering a wide range of topics including salary structures, training, development, benefits and recession-avoidance measures. Twelve agencies took part in the salary survey: BBL, Black Cat, Craik Jones Watson Mitchell Voelkel, DP&A, Wunderman, CMG, KLP, Marketing Store, Ogilvy One and Triangle. The last six agencies mentioned have supplied data for every survey since 1997.

<b>Average salary in 2001 compared with 2000 </b> Average Salary in 2001 (£) Average Salary in 2000 (£) <b>Account Handlers</b> Account Executive 17,400 16,940 Senior Account Executive 19,060 19,220 Account Manager 24,330 23,500 Senior Account Manager 30,210 28,050 Account Director 39,250 37,630 Group Account Director 50,110 53,000 <b>Creatives</b> Graduate Creative 17,500 15,290 Junior Copywriter 17,590 19,940 Junior Art Director 17,630 18,950 Mid-level Copywriter 29,750 27,950 Mid-level Art Director 25,830 27,790 Senior Copywriter 45,920 41,250 Senior Art Director 45,320 41,150 Creative Head 63,000 57,370

Average salary in 2001 compared with 2000

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here