INTERNATIONAL: H&K US latest firm to slash jobs as clients cut budgets

NEW YORK: Hill & Knowlton has joined the ranks of US PR firms

laying off staff as a result of clients' budget reductions.

The WPP-owned company, which is headed in the US by Thomas Hoog, has

axed 20 positions - 13 per cent of the workforce - at its New York

office, including two senior managing directors.

The cutbacks are a result of a reduction in spending by technology

clients and a reduced demand for marketing communications counsel.

H&K's New York office has also been hit by the loss of its pounds

700,000 Puerto Rico Tourism Company account, as a result of a change in

that country's government. This is understood to be a significant factor

contributing to the recent layoffs.

'We made a strategic decision to align our staff with our mix of

business,' explained H&K New York general manager Phil Sheldon. He added

that the firm was continuing to recruit in areas such as healthcare.

H&K's layoffs follow the trend of an industry-wide purge prompted by

reduced outsourcing by clients.

WPP-owned Burson-Marsteller was the first agency to confirm cutbacks in

November, reducing its headcount by five per cent.

Sister agency Ogilvy followed, losing 70 employees in February.

Edelman, too, has announced that it is slashing its worldwide workforce

by three per cent, representing 60 positions across the company.

Spurred by the slowing economy and a decrease in projected fee revenue

for 2001, Edelman President and COO Pam Talbot said the cuts were not

specific to any practice area or region.

However, most are US-based positions, in particular at the Milwaukee and

Seattle offices; and the three-person Houston office is to close.

'When it became clear that we would not be able to achieve the 25 per

cent growth rates we originally projected for fiscal year 2001, it made

sense to adjust staffing and to act now to control costs,' said


In addition to the layoffs, Edelman has temporarily reduced the salaries

of its executive management team, transferred some employees to its

sister agency PR21, and eliminated many 'non-essential' corporate

initiatives, such as agency marketing and promotion.

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