The World: Sydney - Australian ad agencies find market conditions tough

More than half of Australia's agencies are finding market conditions tougher than they were five years ago, according to a new survey.

The poll, carried out by the software company Instinct Systems, also found that 58 cent of the agencies questioned believed clients were cutting budgets and 63 per cent claimed that staff costs were rising more than clients were being charged. Only one-third of the agencies surveyed said they were billing more than 50 per cent of account service time to clients.

The survey also revealed mounting concern about more clients taking work in-house. Half of the agencies and design studios taking part said they had lost business to clients wanting to take control of the process.