In the last five years, this trend has intensified, and the desire to move in-house is now at its highest, and at every level of experience.
Let’s take a look at a scenario that we often encounter – an agency professional will approach us with around 5-8 years of experience, looking to work in-house. When we ask for their reasons for moving, the answer is usually one or more of the following: they want to work for just one brand; they want to be at the heart of the business; they want to have more of a say over the comms strategy; they want to be in control of their diary. They also think they will receive a better salary, a bigger bonus, and lots of high value company benefits. However, as our survey revealed, this isn’t always the case.
Where does this leave the agencies?
The brief answer: desperately short on talent. Having said this, it doesn’t mean that they are blind to the situation. We know from what our clients say that they are thinking about their hiring and retention strategies. Perhaps not hard enough though.
The larger agencies have in-house recruitment teams to support them with sourcing talent and they actively use LinkedIn to approach people and often have great incentive schemes for their employees to introduce people from their networks. The agencies that struggle the most to hire are the small to medium-sized agencies as they won’t have dedicated resource or the brand name behind them. An agency MD will ask me why they are not getting any CVs or any response from an advert they placed. The reason is that only a small percentage of the industry will now consider your agency role – it’s that simple.
Why have agencies managed to fall so far out of favour?
Agencies haven’t necessarily done anything different to push people away, it’s just that many haven’t really moved in line with the change in attitude towards flexible working and the fact that millennials (a large proportion of the industry) want a better work/life balance. Agencies are still great places to work – it’s fast paced, varied and challenging. However, not everyone wants this. As in-house communications teams have increased in recent years, there have been more opportunities to move in-house, and that trend is here to stay. The desire to do something different, have better company benefits and work for one brand is appealing.
What can they do about it?
It really is time to for agencies to take some serious action, and fast, or they may well forever be considered second best. Our survey found that agencies are giving out more pay rises than in-house companies across all levels – for the first time in ten years. They are also giving better bonuses at a senior level. Board Directors received an average bonus of 55% of their salary, compared to the 30% bonus for Global Heads of Comms in in-house companies. Quite a difference, and definitely one of the more surprising findings from the survey; again it’s the first time we have reported this in ten years. The agencies are clearly making an effort to reward and retain their teams.
What else do they need to do?
Take a long, hard look at their flexible working and well-being policy. Millennials, in particular, just won’t put up with it – they will move if they are not happy.
Is the grass really greener in-house?
A closer look at the average salary of an agency professional and that of a professional working at the same level in-house shows that they are being paid about the
same. Our survey found that pay rises were on average very similar in agencies (6%) and in in-house companies (7%). However, the company benefits are better in-house when it comes to what’s on offer, the value of the benefits and the take up. There are also better pension contributions on offer in-house.
So there is still a way to go for agencies. While they have clearly stepped up their game, they still fall short when it comes to offering an attractive ‘full package’.