The market has been changing rapidly and we do not know what the new world of corporate comms is going to look like. Alongside filling roles (yes, there are some companies still hiring), we have been talking to as many people as possible across the corporate communications industry, agency and in-house at all levels to get a better insight into what is happening in the market. Here we share our findings.
We have noted that more generalist agencies with clients spread across a variety of sectors are faring well and, alongside financial services specialists, seem to be weathering the storm ok. They are winning projects, although, as no-one is going through a pitch process, the pipeline of new business has dropped, and they are not sure when those new business conversations will ‘come to roost’.
Corporate comms agencies overall are ensuring that their work is as relevant as possible for their clients in the moment, undertaking a huge amount of monitoring and producing daily bulletins for clients on coronavirus. They are supporting with crisis comms, employee comms, and the public affairs teams seem to have stepped up their comms with Government on behalf of their clients.
A handful of agencies continue to hire and naturally, because more people are coming on to the job market, there are more candidates to choose from. Some of our more senior level search campaigns have slowed although the intent to hire remains.
It feels that every agency has been affected revenue wise to varying degrees. Quite a few have said that they think they have lost about 20%of their revenue so far. The ones with a high percentage of retained clients (over project work) are feeling a little more secure about the year ahead.
As we know some sectors have been hit harder than others which is having a knock-on effect on comms budgets. The specialists seeing more repercussions in their comms budgets include oil and gas agencies because of the fall in share price, property, leisure, hospitality, and sports, amongst others.
We have noted that some retainers have been paused, campaigns have been delayed to later in the year, project work has stopped, work has switched from print to social media, and some mandates have been lost completely.
Agency owners talk about examining their costs as ‘cash is king’ right now and many are reducing costs where they can – letting go of their office space as one measure. Not many agencies are advertising the fact, but we suspect a lion share are furloughing some staff – mostly junior employees and non-essential members of their teams. They have also let go of their freelancers and those on short term contracts, in order to come out standing strong the other side of this lockdown.
The hard-hit agencies have asked their employees to take a salary cut of 10 – 20% and have already said that bonuses will not happen this year.
The drop off in M&A for our traditional corporate and financial comms agencies is leaving them more exposed, although they are busy with managing the comms around various crisis situations and client administrations. It has been commented that their private equity clients will be active coming out of lockdown, which will help get their revenue back on track.
We have been speaking to a variety of in-house corporate comms teams across financial services, professional services, retail, and many others. They are flat-out, with many saying that they have never been busier. People need information more than ever and in-house teams are coming into their own. We are also seeing an increase in companies being active on social media.
There may well be a knock-on effect however, with one general insurance company comms professional saying: “we haven’t reviewed our agency budget for this year, although we are reviewing it for next year”.
We have been speaking to lots of in-house comms professionals whose contracts have been halted or finished early. The self-employed freelancers are being hit hard as client work is drying up quickly.
Some senior in-house and agency contractors will take a salary cuts of £10k-£20k for the stability of a 12-month contract. Clearly these are tough times for the people out of work.
Interestingly, we have had calls from professionals in permanent roles making big decisions about their career. Some would like to change industry sectors and are willing to leave their permanent roles for a contract role in order to make the change. Staying at home is clearly giving people time to reflect on their career aspirations.
We often talk about the desire for in-house roles and right now it is through the roof; however, with more professionals entering the job market, candidates are starting to be more flexible and are opening themselves up to agency opportunities too. The desire for agency roles is low, however we suspect that agencies will have more candidates approaching them for roles once again as those out of work ‘need a job’.
Looking at LinkedIn adverts, we can see that advert responses has quadrupled for many roles. Although in-house comms teams receive a lot of applications, they are challenged by finding high performers and getting the right fit. This is unlikely to change, although they will have more people to select from who are available quickly.
Those sitting in permanent roles may be a little more cautious about moving right now although, again, we are having conversations with those saying they are still very open to moving despite the market as their reason for leaving hasn’t changed.
No-one really knows what lies ahead, we are just grateful that the sector is standing strong and companies are hiring, albeit at a much lower level. We wish everyone all the very best with getting through this challenging time, to remain healthy and enjoy this unseasonably sunny weather!
As I’m sure you are aware, The Works Search is a search consultancy specialising in PR and corporate communications. We have unrivalled matching abilities and known for finding the top 5% performers in the industry - the ones who deliver and make your reputation great. For more advice or market insights, do get in touch with us on 0207 903 9291 or email firstname.lastname@example.org