BOTW: A holdco of vacancies

Welcome to Unmade, kicked off in the lounge, waiting for a winged minibus to take me home to sodden Sisters Beach, Tasmania. It’s the busiest I’ve seen Melbourne Airport since before the pandemic. Finals season, huh?

Happy International Grenache Day. I’m down for that.

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It was a hectic week. Tuesday was a day of breakfast in Burnie, lunch in Melbourne and supper in Sydney. And that was the quiet day.

Along with Nine’s Upfront event on Wednesday, I did a lot of catchups with people running agencies, both creative and media.

One topic came up in every meeting. Anecdotally and evidentially, there’s never been a tighter job market – certainly not in the working memories of those currently in charge.

One person estimated that based on vacancies within the big groups, there are currently enough open roles to staff an entire extra holding company.

There’s never been a time like it.

The last time we came close was a little over a decade ago when the digital advertising ecosystem began to emerge. Media agencies gearing up to offer search, performance marketing and the beginnings of programmatic found the skills were lacking onshore and lacked the patience to develop their own people. As a result, there was a wave of imports from the UK.

The circumstances were slightly different back then. For one thing, it was a boom specific to our industry. For another, the visa system was more generous, offering much easier paths to citizenship. And until the closure of the Living Away From Home Allowance loophole, the tax situation for overseas expats in Australia was also ridiculously generous. If I’d understood the tax system better when I arrived in the country in 2006, I’d have rented a palace.

This time, every industry is short of people, all at once, with the same going on in the overseas markets Australia recruits from. It’s also much harder now to offer a promise of a guaranteed route to citizenship which makes it harder to attract people deeper into their careers.

The vacancies stretch across every skill within the communications industry ecosystem.

A search of LinkedIn ads shows a huge number of Australian vacancies across the big holding companies:

• WPP: 119 roles

• Omnicom: 83 roles

• Dentsu: 81 roles

• Publicis: 54 roles

• IPG: 49 roles

• Havas: 21 roles

Even S4 Capital’s Mediamonks, which is supposedly in the midst of a pre-recession hiring freeze, is advertising for ten local roles. Ironically one of those is for a recruiter.

More widely, Seek is currently carrying ads for 1,042 open jobs in the advertising, arts and media sector, and a further 5,025 in the marketing and communications sector. While that may include some duplication, not all vacancies will be currently appearing in the search. The numbers also suggest that recruiting is just as hard within brand side marketing teams.

The nature of these things is that roles are often filled by hiring somebody working at the rival agency across town. Which is turn creates another vacancy.

Anecdotally, I’ve been hearing of even previously stingy companies giving exisiting staff huge pay rises, well above Australia’s current painful 6% inflation. That’s pragmatic on the part of employers who were able to keep pay rises close to zero during the first year or two of Covid. The cost of having to recruit in a brutal market – and then having to pay top rates – is often far more than it would have been to keep staff happy in the first place.

Anyone currently in the communications who hasn’t seen their pay grow by at least 10% over the last year or two should be asking themselves one question: Why doesn’t my employer want me to stay?

There’s been no better time for all staff to ask for a pay rise taking the approach recommended by Cindy Gallop to women suffering from imposter syndrome: Ask for the biggest amount you can think of that you won’t burst out laughing saying aloud.

Conversely, any employer in this sector who has not found ways of giving those sorts of rises should not wonder why staff are being poached. In this situation, the best way of containing costs is to put a generous pay rise on the table before staff members actually go out and test the market and discover for themselves their radically increased value.

The smarter employers have already recognised the changed landscape. Simply poaching from elsewhere is not the affordable, but lazy, option it once was. Hiring more graduates and building genuine, in depth training programs to develop them faster on the job is an approach being taken by those with the resources and patience to do so.

That means an inexperienced agency workforce in an industry that already skews young. I wonder how many chief marketing officers out there currently believe they are getting the quality of experienced service they are paying their agency partners for.

And yet… this extraordinary situation won’t last long. Bust usually follows boom.

In the last set of updates from the global holding companies, they all found different ways of telling the market that they just don’t know what happens next for the global economy. Despite high levels of employment, The US and UK are teetering on recessions, driven by a raging cost of living crisis and escalating interest rates. This coming week, the US Federal Reserve is likely to push up interest rates by a further 0.75 or even 1.0 percentage points.

Thanks to Australia’s distance from the European energy price crisis which is being driven by the Ukraine conflict, our inflation isn’t quite as bad. But a global recession (or a simple slowdown) will inevitably affect us too.

The only risk for those who jump across right now is the security of their next role if they take it.

Globally managed groups may force tough decisions on local managers down the track, even if the economy doesn’t turn quite as bad here. (Mind you, it’s hard to believe Australia’s own rising interest rates are going to have no impact on the local economy, given how much some people stretched themselves to get onto the property ladder.)

But that lies ahead. The pandemic may have become endemic, but its impact on the world we work in still has many years to play out.

There’s never been a more appropriate time to ask for a pay rise, and to give a pay rise.

Unmade Index: Back in slump territory

The Unmade Index fall back below 700 this week, meaning that the collective valuation of Australia’s ASX-listed media and marketing companies is once again more than 30% off it’s 1000-point opening at the start of the year.

Yesterday’s slight improvement of 0.17%, to 695.6 points, didn’t come close to eating into the falls in the index of 3.13% and 0.32% on Wednesday and Thursday.

Most of the slight improvement in the index yesterday was driven by Nine’s 1.96% growth for the day, although the company is still down for the week as a whole.

Among the broadcasters, Southern Cross Austereo had the worst of it yesterday, falling 4.98%. The company’s market capitalisation has once again dropped below the quarter of a billion dollar mark, and is trading at its lowest point since June.

Time to let you enjoy your Saturday.

Damian Francis and I will be back on Monday with the Start the Week podcast.

Have a great weekend.

Toodlepip…

Tim Burrowes

tim@unmade.media