A benchmarking study, which was carried out earlier this year by UK agency trade body the PRCA, showed that many larger consultancies lose more than one third of their staff every year – an annual ‘staff churn’ rate of 36 per cent. But even smaller agencies have an average churn rate of 24 per cent.
PRCA chairman Richard Houghton confirmed that the rate of staff churn – now 27 per cent on average – was at its highest rate since the dotcom boom of the late 1990s.
‘It is not necessarily a bad thing as it is partly a reflection of a buo-yant industry,’ said Houghton, whose organisation represents 125 leading UK agencies.
However, some in the industry are concerned that the high turnover of staff is causing spiralling wage inflation and heavy fees to headhunters.
Houghton said the staff churn was highest at the middle management level.