The findings are the result of a new benchmarking survey on pricing and practices, launched by the Healthcare Communications Association (HCA).
The survey found that 43 per cent of respondents anticipated worsening market conditions, with 57 per cent expecting no change. No agency said the sector would improve.
Average increases in fee incomes of only three per cent were offset by a corresponding decrease in operating profits of one per cent, the survey also found.
HCA Benchmarking Sub-Committee chair Fiona Hall said the survey could serve as a negotiating tool for agencies when facing client procurement departments.
She added: ‘The exercise will give agencies evidence to support claims for the continuing market squeeze and their demands for margin protection… It shows that agencies are not trying to pull the wool over the eyes of clients.’