Pay must filter down to woo new talent

A recent pay survey sees those at the bottom of the agency hierarchy losing out as the top echelon cream off the salary spoils. Mark Banham looks at the reasons for this disparity in remuneration.

According to a salary survey unveiled by recruitment specialist the Davis Xchangeteam last week, some media agency chiefs are taking the lion's share of agency pay increases.

The average remuneration for the highest paid executives increased by almost 14% during 2005, while the average salary increase for a planner/buyer with one or two years experience increased by an almost static 0.6% over the same period. Those at the bottom of the scale, lowly graduate entrants, fared worst of all, with their meagre pay actually falling, by nearly 1.6%.

In defence of what seems an unfair distribution of cash, the report explains that the 2004 survey saw a huge growth in staff demand that led to increases in salaries at all levels of media agencies, except for the more senior positions, where the increases were negligible. This balance was effectively reversed during 2005, with client directors receiving most of the salary spoils.

The report concludes that the disparity in salary increases was affected by the prolonged advertising recession between 2001 and 2003. During this time, the majority of media agencies cut back on recruitment at the lower level, so the numbers feeding into the industry were less. Furthermore, procurement issues for clients have had an effect. Agency bottom lines have come under pressure, which impacts on the multiple salaries paid at the lower levels.

Graduate salaries

Yet, in relative terms, a media graduate entrant is better off than the average graduate. According to the Office of Fair Trade, the average salary a new graduate can expect to receive is £16,500, whereas, in media, the average starting pay is £17,357. However, this level of pay lags far behind the national annual average of £24,492, according to the Office of National Statistics.

Gill Hollis, head of media planning and buying at Davis Xchangeteam, stresses that the survey does not include media owner data. It also does not reflect the salaries of any particular agency. It is an amalgamation of data drawn from all in the top 20 and many more. She says salaries may be slightly higher in media, but the workload and hours are more demanding than even five years ago. "I think the pressure on media agency margins is definitely filtering through and, from what I hear, it involves people working ridiculously long hours," says Hollis.

"New business pitching is something you do in your weekends and evenings, and it is not unusual for my candidates to tell me that they work six days a week." The result, she adds, is that the media agency culture does not seem as attractive as it once was.

Strong competition

Since media is a particularly London-centric business, media faces strong competition for career entrants from higher paying industries, such as in the City.

Aliya Drabu, head of people at Media Planning Group, says: "As an industry we are moving in the right direction to become best practice recruiters. The City and other blue-chip companies, who are also some of our clients, are going to be competition in recruitment for us."

This competition, says Hollis, means that she has more jobs on her books than she can fill. "Job supply is outstripping demand. We have positions at all levels, with lots of different agencies, and we don't have enough good candidates," she adds.

It is unlikely that working hours will reduce in the near future. But the pay issue has to be addressed if agencies are to compete for the brightest talent.

Tim Jones, human resources director for Aegis Media, admits that starting salaries may be "challenging", but says that the amount his network spends on training increases every year. Salaries can increase rapidly. "There's a high turnover in the industry, in general, and holding onto people is a challenge. But recruiting new graduates is the future."

Few could dispute that agency senior honchos deserve their pay increases, but unless they can improve their profit margins to pay for new talent, or find a way of more equitably dividing up the payroll, then the inability to recruit can only continue to act as a constraint on their businesses.

AGENCY SALARIES 2004

Title/Level: Average (pounds )

Graduate: 17, 560 (No experience)

Assistant: 19,630 (6-12 months)

Planner/Buyer: 25,610 (1-2 years)

Planner/Buyer: 27,910 (2-3 years)

Planner/Buyer: 35,000 (3-4 years)

Manager: 39,980 (4-6 years)

Group Head/A.D.: 52,820 (6+ years)

Client/Media/Business Director: 79,000

AGENCY SALARIES 2005

Title/Level: Average (pounds)

Graduate: 17,357 (No experience)

Assistant: 20,688 (6-12 months)

Planner/Buyer: 25,773 (1-2 years)

Planner/Buyer: 28,187 (2-3 years)

Planner/Buyer: 35,727 (3-4 years)

Manager: 41,433 (4-6 years)

Group Head/A.D.: 58,683 (6+ years)

Client/Media/Business Director: 90,050.

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