Poll: How adland blew-up its talent market and what it needs to do to fix it

In last weekend's Best of the Week email, Mumbrella's head of content Damian Francis suggested the current significant talent shortage in advertising, media and marketing could have been two decades in the making, and may be far deeper than the industry thinks. Have your say at the bottom of the opinion.

It’s an employee’s market at the moment. Hiring the right people has become a burden on the industry. It shouldn’t be. It’s costing businesses a lot, in both time and money, and they aren’t always getting the ideal candidates.

Part of that has been due to the fact there is no international talent landing on our shores. A pandemic induced shortage?

Could that old adage that half of the media and marketing industry in Australia is British be a little bit closer to the truth than we would perhaps like to admit? While a large amount of the industry is, the answer to that question is no.

International talent has been cut off with the closed borders and has created a situation where local talent movement is the only movement that can happen aside from Aussies coming home. As a result, there is significant pressure to get the right people at the right time. But as we come to the end of the lockdowns in Australia (hopefully), this likely won’t see the end of the talent shortage.

Nick Williams, founding partner of Williams International and a very wise head on more than just the recruitment front, put it quite simply in a quick, on the record conversation. He said the problem at this stage is that those that wanted to move have moved – the majority of the rest are happy where they are and that is making it even harder to get the right talent. In effect, it’s driving prices and rewards up even further. But again, this is not the crux of the issue.

In adland, there are plenty of jobs listed, and businesses are also willing to pay over the odds to secure good talent. The interesting thing is that statistically there should be plenty of people in the market for new roles.

For example, according to a July report in Human Resources Director magazine (there’s a B2B publication for everyone), “73% of employees would be more likely to stay in their jobs if employers increased the reward and recognition strategy on offer. Similarly, 96% of employers said competitive R&R is vital to retaining employees.”

Importantly, that report also stated that further research found,”…42% of the 3,809 employees and HR decision-makers surveyed said they planned to leave their jobs or would begin looking for a new role this year.”

Unfortunately for media and marketing, that doesn’t seem to have translated to this sector. More than this, it’s opened up an adland wound that was apparently received decades ago and hasn’t yet begun to heal. See this Mumbrella report from nine years ago, for example.

According to many that I spoke to, the talent drought has been almost two decades in the making, and not enough is being done to climb back out of it. The pandemic has only highlighted the significant issues and possibly worse, some are using it as the excuse.

I was given an example of a group account director at a large creative agency who, in the early 2000s, was on a salary around $140,000 mark per annum. Today, that salary is not significantly higher despite significantly higher living costs. It’s all but stalled.

Another industry leader went on to say that, back then, agency roles would have pegged or been higher than client or brand roles, but are now significantly less.

In other words, the pressure we are seeing on adland now to significantly increase salaries and rewards in order to nab the right talent is far beyond a pandemic related issue. It’s been growing for quite some time and is at a point where it’s arguably out of control because the industry fought it for so long and now has to make a massive jump not to pay over the odds, but just to catch up.

That being the case, the re-opening of Australia could actually be detrimental to the talent shortage. It could see an exodus of talent.

“We are a net exporter of talent at the top end,” I was told. “We lose people constantly – from six to seven years in, in particular. If they don’t go overseas, they go client side or to small businesses, maybe even to platforms. We also lose these people to parenthood – the benefits of working in the industry don’t outweigh having children and staying at home. We lose these people simply because the competition from other industries is stiff and they pay better. These are very talented people.”

Even if the borders opened tomorrow and people were lining up it would not be a quick fix, said another exec. They went so far as to say that we have been exposed in some big areas of weakness in our industry, they are significant, but few want to admit it.

Those areas include training and development as well as investing in allowing staff to have the time to actually participate in both of those. Alarmingly, a direct quote was, “Let’s face it, churn and burn is a reality in the early years and the money is not great.”

So emphatically, border reopening is not going to deliver the market correction the industry needs to get things back on track. Instead this will take a much stronger correction which looks like it will need sustained salary increases, better conditions and a bigger investment in training. It requires the industry to make a few tough and honest admissions, and then act to correct them.

The key word though, is ‘sustained’. Can the industry sustain the current salary hikes and rewards to ensure that it can compete against other industries for top talent? Can it instigate the training and development required to build the employees it has.

That’s going to cost a lot of money. Can adland get it?

Possibly, said one expert. “One issue is that most agencies have a price list of services based on current salaries – it’s how they estimate new business costs. That means the biggest issue they face is whether they can increase the prices they are charging clients. Either that, or they make less money and deal with it, or populate account teams with fewer people and clients have to be happy with that.”

That was followed by the quip: “If agency leaders can’t negotiate higher retainers with their clients, who can? Builders are charging clients through the roof at the moment – surely agency leaders have better negotiation skills.”

And just like that, we’re back talking about the client squeeze on agencies. Or is it the global networks driving down prices to win accounts? There are, of course, many arguments here.

Adland is up against it. Escaping this situation is not simply about negotiating with clients (that’s hard enough, anyway) and putting salaries up.

As I mentioned above, part of this is about training and development. Every agency is going to lose people at some stage – part of the key to avoiding the current situation is to have a healthy talent pipeline.

In other words, hiring from the bottom of the chain and supporting those people upwards.

Young talent is supported to an extent, but more needs to be done

Turns out that’s also a big problem, as one source told me. “At the moment, youngsters are having to be 90-95% billable, so they are just on the clock and nothing else. There is no time for them to expand their knowledge. The timesheet is killing the industry. Our factory line is our people. You can’t just create more. We make people work harder and you can’t invest in growth.”

More than one person told me that over the last few years we haven’t recruited enough at the more junior levels. “Less demand for junior to mid weight strategy executives has caused some challenges. There is an expectation that clients will only pay for senior people. But where are senior people coming from? Adland needs to invest in its juniors more than it is now. Some agencies and sectors are doing it well but many aren’t.”

Another exec said it in a less politically correct way. “Senior executives? You can’t fucking magic them out of thin air. We’re simply not feeding enough juniors into the machine. When are we going to focus on that?”

Enter that easy to say but difficult to define word – ‘culture’. Were you waiting for me to drop that word in after I mentioned training and development above? Cringe as some may, it’s a reality. Investment in real culture improvements could begin to alleviate the pain. But it’s a slow burn.

To paraphrase one agency leader: In a talent shortage, you need to be great at what you do and have a great culture. Culture in all aspects – what is the business doing and what is the talent doing that allows all of the business to build? There are certain agencies that are easier to place people at and those agencies generally find it easier to keep people.

They suggested, however, that smaller agencies will likely not have the ability to really invest in significant cultural steps but still have to compete on remuneration to get top talent.

Simply offering over the odds remuneration and not addressing anything else also creates more problems. An agency will end up losing the really loyal people who have gotten there through hard work. In effect, it’s creating an internal two-speed economy.

Perhaps this is an ideal time to revolutionise the industry a bit.

“We should have done this a long time ago,” I was told. “Bringing in people who might not be cookie cutter choices. The more we take cookie cutter people the more problems we create.

“We need to be hiring differently. Our clients want practitioners who can bring something different to the table as well. It’s about being revolutionary and evolutionary with hiring talent that can bring more creativity and deeper thinking. Great solutions.”

There are two things we definitely know: the talent shortage won’t end soon and salaries will remain high. So how do we meet that challenge?


Results of the poll will be published later in the week. 


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