The cynical saying in some advertising “sweat shops” used to be, “If you don’t come in on Saturday, don’t bother to come in on Sunday.” That had more than a grain of truth to it. Advertising has always been demanding and people had to put in long hours to meet tight deadlines.
Agencies compensated with perks from first class travel, and catered dinners from expensive restaurants. One agency even had a butler that was responsible for dry cleaning. Advertising was a prestigious occupation, as captured in “Mad Men”, and, to boot, financially rewarding. And therefore, it attracted the best people despite the grueling schedule.
That changed in the 1980s when the Reagan stock market started taking off. All of a sudden, the center of gravity for college graduates became Wall Street, and the desire to become “masters of the universe,” the Gordon Geckos of the world. Wall Street starting salaries were a multiplier of senior salaries on Madison Avenue. The best people stopped coming to agencies.
A decade later came the dot-com bubble and the most innovative people were flocking to Silicon Valley. Many of the best people in agency leadership also quit to join start-ups in pursuit of IPO instant riches.
And so, for the last two decades, the talent pool on Madison Avenue was depleted. It took agencies too long to look for alternatives to the brain drain. Women were kept from leadership role until recently and agencies are slow to diversify.
However, through all of these agencies maintain the “If you don’t come in on Saturday” mentality. In fact, it was exacerbated. Starting with the 2008 recession many people were laid off, and those staying were asked to do double duty. Then, last year, Forrester reports, another 50,000 were laid off.
At the same time advertisers cut agency compensation and, consequently, all those perks that agency people enjoyed, evaporated. The extra pressure, the increased time demand, the lack of adequate support and no training result in the predictable outcome: Young agency people are rushing for the exit.
This is a “watershed moment” for Madison Avenue. Burnout from 24/7 agency work and the desire to work remotely are among the drivers. A survey of 423 marketers and agency employees by the freelance platform We Are Rosie, found that 63% plan to change jobs or careers this year, 40% demand flexible hours, and every respondent said they wouldn’t consider a job that doesn’t offer the option of remote work.
Many agencies are expecting employees to return to the office at least a few days a week. But only 16% of senior ad execs want to return to the office. Lots of people are quitting and switch to freelancing. The good ones can make more money and work half as hard.
Generation-Z has shown that they have very different desires for their careers compared to Baby Boomers. They want a life and work balance. Gen-Z also desire to be at a company that shares their ethical, social and political values.
Now that there are many other attractive employers where young people can earn a nice living, while having a balanced life and doing something with purpose and meaning, agencies need to change. Many young people have alternatives, such as going to work in casual clothes such as jeans and T-shirts at cool startups that offer pre-IPO equity and stock options. Agencies will be forced to become more competitive to attract top talent.
The problem is much more layered and textured. To attract and retain the best talent agency, leadership needs to lighten the workload of young people and compensate them in a more attractive way. Most importantly, it must provide them with appropriate training which is not altogether there.
David Ogilvy famously stated that “All of our assets go down the elevator at 5:00 o’clock.” Madison Avenue is risking depreciating those assets. Agencies that forget the value of talented employees cannot long survive.