As MPs savour the possibility of a 30 per cent pay rise, the pundits
rehearse the usual arguments for and against. As ever, those in favour
will stress the need to pay a ‘market rate’ to attract sufficiently
In this respect, politics has something in common with PR. But while
Westminster seeks to lure budding politicians away from a host of better
paid industries, PR firms are, for the most part, scrabbling to recruit
talent from other parts of the same business.
Post recession, there is a distinct shortage of experienced PR people.
The pressure to compete with other consultancies for tantalising slabs
of new business is therefore driving pay deals to exorbitant heights. It
is difficult to escape the conclusion that the PR industry is in the
grip of a damaging round of salary inflation which will put further
pressure on profit margins at a time when wary clients are still
screwing them down.
Yet money is not always the answer. Experience shows that a
consultancy’s ability to retain staff in the face of determined poaching
frequently depends on other factors such as the reputation and culture
of the company, future prospects, and the potential for owning a stake
in the business. The consultancies with the best record of retaining
talent are also those which invest in their staff - not with exaggerated
basic pay - but with performance bonuses, share options, and training.
Big salaries may solve a short-term recruitment problem but it is likely
to store up trouble for the future. It won’t improve the quality of the
candidates, or increase the overall talent pool available. Nor will it
necessarily secure loyalty. Paying over the odds for new staff may just
encourage your existing staff to seek the same - either with you, or
It may also lead to something even more damaging for the fragile
reputation of PR - job title inflation. As during the 1980s boom,
relatively inexperienced executives find themselves catapulted into
senior positions before they are ready. Some will rise to the challenge
but many will not, and overall standards will fall accordingly.
There is no easy answer. The long term solution is training and
recruitment at the junior end of the business. In other words grow your
own talent. In the short term, the challenge for agencies will be to
retain their existing talent in the face of some tempting offers,
without breaking the bank on salaries. And to take on new business
without overstretching their resources.
For some it will be a difficult balancing act.