NEWS: Study shows staff hours rise

British agencies are becoming leaner and meaner by working their staff harder, paying them less and earning more money from them, according to new research.

British agencies are becoming leaner and meaner by working their staff

harder, paying them less and earning more money from them, according to

new research.



The ad industry has finally lost its 80s reputation for profligacy and

poor management in the shake-down following the recession, claims the

industry and company data analyst, ICC Information.



Its survey shows just how deeply the recession has reduced staff numbers

at top agencies, where the average number of employees has dropped from

more than 150 in 1991 to about 100 last year.



But the study also suggests that staff are being better utilised, with

average profit per employee having more than doubled from pounds 1,300

to pounds 3,600 over the same period.



At the same time, agencies have managed to keep a firm grip on salaries,

with average pay dropping from a high of pounds 21,700 in 1993 to less

than pounds 20,000 in 1994.



Greater financial discipline also appears to be extending into other

areas of business, with agencies shown to be getting better at chasing

their clients for payment.



Two years ago clients took an average of 60 days to settle invoices. By

last year they had succeeded in reducing the period to 53 days, although

this is still far in excess of the traditional 30-day payment terms

common throughout most British industries.



The survey also found that agencies are getting better at settling their

own bills, with media invoices being paid within an average of 40 days

last year - six days earlier than two years ago.



But the improvements have yet to be translated into significantly higher

profitability. The survey shows that 22 per cent of agencies are still

recording a loss, although the figure has dropped from 32 per cent in

1991.



Annette Smart, an ICC executive, said the findings showed agencies had

learned lessons from the recession and begun to recognise the importance

of using research to target new business.



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