Monday, February 18, 2008
Good analysis by Bradley Johnson of AdAge today.
Media employment in the USA in December 2007 fell to a 15-year low (886,900), slammed by the slumping newspaper industry. But employment in advertising/marketing-services -- agencies and other firms that provide marketing and communications services to marketers -- broke a record in November (769,000). Marketing consulting powered that growth.
Here's the reason behind the disparity: Marketers still invest in marketing, but they have options far beyond paid media: digital initiatives, direct marketing, promotions and events, just to name a few. That creates more opportunities for consultants to help define strategies.
Agencies also have adapted, expanding beyond simply creating and placing ads. Indeed, Ad Age DataCenter research has shown that U.S. marketing-communications agencies collectively in 2005 for the first time generated less than half of their revenue from traditional media and media planning/buying.
Want more evidence of tumult in media? Consider performance of stocks in the Ad Age/Bloomberg AdMarket 50 since May 2002, when U.S. measured media spending began to recover from the last recession. Since then, four of five agency stocks and 15 of 26 marketer stocks have risen. But a majority (11 of 19) media stocks have fallen.
Among all the ad-related job sectors, the hot spot is marketing consulting. Employment in that field in December reached a record 148,500, accounting for the lion's share of job gains over the past year in advertising and marketing services.
Marketing consultancies over the past year added 14,500 jobs (up 10.8%), nearly matching staff cuts at newspapers (down 16,900 or 4.7%).
The job figures come from an Ad Age DataCenter analysis of Bureau of Labor Statistics data. For purposes of the jobs tally, Ad Age defines media as newspapers, broadcast and cable TV, radio, magazines and internet media companies.
Ad/marketing services consists of marketing consultancies, ad and PR agencies, media agencies/media rep firms and graphic design firms, all of which saw gains in 2007; and firms involved in market research, ad-material distribution and direct-mail advertising, which cut jobs last year.
Below the bubble
With the notable exception of marketing consultancies, employment in advertising/marketing-services sectors remains below sectors' historic highs (hit mostly in the 2000 bubble). Ad-agency staffing, for example, is 10% below its 2000 peak; employment at PR agencies is 11.5% off its 2000 high.
Still, ad/marketing-services sectors have rebounded from the ad industry's January 2004 post-recession employment nadir. Advertising/marketing services has added 106,000 jobs since then; marketing consulting accounted for nearly half (48,200) of those gains.
It's a different picture in media. Since media employment peaked in dot-com-infused 2000, media companies have eliminated one in six jobs (167,600).
Newspapers, TV and radio all cut staffing last year. The only media sectors to add jobs: magazines (up a meager 400 jobs) and internet media companies (up 9,200).
Web still hot
Internet media companies, a sector that includes search engines and web portals, is a bright spot, with a 13.4% jump in jobs last year. Still, internet-media employment remains 31% below its dot-com-bubble peak.
The big problem is newspapers, which account for half (82,800) of media jobs lost since 2000. One in four newspaper jobs have disappeared since newspaper employment peaked in 1990.
Newspapers, saddled with heavy costs of printing and distribution, last year accounted for 38% of U.S. media jobs, down from 50% in 1990.