Ad Groups Cut Workforce, but 'Not MR'

Some of the world's biggest advertising groups have this week announced thousands of job cuts. However, their MR firms seem to be relatively little affected so far, as do PR subsidiaries, while ad agencies themselves bear the brunt.

Omnicom Group cited current economic conditions and their particular effect on advertising in key sectors including automotive. An Omnicom spokeswoman said the layoffs would represent 'less than 5%' of the company's work force - this might mean around 3,000 to 3,500 of its c.70,000 global workforce. The statement said Omnicom companies 'have reviewed their staffing levels as they relate to their current business requirements' and as a result, 'Some, but not all, will have to make adjustments.'

Ad firms TBWA Worldwide, DDB Worldwide and in particular BBDO Worldwide are expected to suffer more than other companies. BBDO works with struggling Chrysler LLC and recently lost a major contract in Pepsi, and says it will cut 189 jobs in North America, equivalent to around 5% of its staff there.

The Atlanta office of Omnicom's PHD media buying and planning agency is closing with 23 jobs lost. Seven jobs will also be cut at PHD's Detroit office. The PHD Atlanta office serviced local media buying for Chrysler.

Omnicom's MR agencies, which include Flamingo, Hall & Partners and M/A/R/C Research, are unlikely to be affected by the cuts; and reports from a number of Omnicom's PR firms said they are not planning major programs of redundancies.

Reports from Reuters (www.reuters.com ) this week suggest that US-based marketing services company Interpublic Group is to cut up to 3,000 jobs or 5% of its global headcount of 60,000. CEO Michael Roth told investors in October he would manage the business 'conservatively' for the time being, remaining 'extremely focused on controlling costs and managing margins'.

Synovate owner Aegis Group has this week completed a round of redundancies which included a number of client director roles; WPP has frozen employment since October, with a review scheduled for possible February restart, but CEO Martin Sorrell has warned of possible cuts in 2009, which he expects to be a much more difficult year than 2008, and unconfirmed reports suggest a large number of jobs could go at the group's Ogilvy & Mather subsidiary. US ad spend is forecast to fall by around 5% next year.

Omnicom's web site is at www.omnicomgroup.com .

All articles 2006-23 written and edited by Mel Crowther and/or Nick Thomas, 2024- by Nick Thomas, unless otherwise stated.

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