Firms react to economic fears with staffing restraint

TORONTO: Although most PR firms have not seen dramatic cutbacks of client budgets, some of them are instituting hiring freezes, as they prepare for the ripple effect of the widening financial market crisis in the US to hit Canada.

TORONTO: Although most PR firms have not seen dramatic cutbacks of client budgets, some of them are instituting hiring freezes, as they prepare for the ripple effect of the widening financial market crisis in the US to hit Canada.

"We are not making any investment hires…or replacement hires, just streamlining the work,” said Julie Rusciolelli, president of Maverick Public Relations in Toronto, which currently has a staff of 20.  Rusciolelli said she is currently ahead of 2007 revenue figures, but said “retainers on the [tech side] got smaller. I still have them and they are still big, but they've got tidied up. They are all California-based companies, so when the operations in California slow down, they cut [back budgets in their Canadian offices]”.

Porter Novelli Canada is also keeping a tight rein on staffing, said the agency's VP and regional director Mark Nusca. Nusca said that's in part because they don't know yet what impact they will see on client budgets for 2009. “We're seeing clients being more careful than they usually are in terms of spending, but I don't see any pull back on spending yet,” he said. Nusca said the “balancing act for agencies right now” is to be careful about pushing existing staff too much, but meeting client expectations without staffing up, in case budgets do get slashed.

That is why some firms are increasingly turning to contract help, a strategy that High Road Communications is employing, according to Justin Creally, the firm's SVP and senior partner. But Creally said even if marketing budgets do retract, he suspects some of that money will migrate to online PR initiatives. “We want to be in a position to take advantage of that,” he said.

However, Creally said that there are a lot of job seekers in the marketplace, there aren't enough candidates to go around who possess a strong social media skill set. Creally said the firm has yet to fill two digital positions in its Toronto office.

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