Editorial: Staff investment still below par

Willott Kingston Smith’s survey of 200 marketing services companies reveals that, for the first time, PR consultants are generating a greater level of gross income per head than their counterparts in the top 50 marketing services groups.

Willott Kingston Smith’s survey of 200 marketing services companies

reveals that, for the first time, PR consultants are generating a

greater level of gross income per head than their counterparts in the

top 50 marketing services groups.



The report also suggests that these figures may reflect a move by PR

consultancies away from low value accounts and project work towards

larger strategic accounts. This is good news for the industry, and

indicates that consultancies might finally be moving some way towards

breaking the classic cycle of client overservicing.



The survey also shows that the number of staff being employed in the PR

industry has risen by 12 per cent to 4,555, while employment costs in PR

have increased less than the rate of inflation. This is an indicator of

short term gain, but shows that recruitment activity has mainly taken

place at a junior level. The industry is still dogged by a dearth of

experience PR managers.



Willott Kingston Smith estimates that, as a benchmark, companies should

spend half of their gross profit on staff costs. According to this

survey, the profit:investment-in-staff ratio on average still falls

below the recommended level. The findings also show that agencies have

only been recruiting in line with a rise in fee income.



Such prudence certainly cuts down on wastage, but in a growth industry

there is also a need to strike a balance between linking rises in staff

costs to income and recruiting for expansion. In order to maintain their

long term profitability, consultancies still need to spend to attract

and retain experienced staff.



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