Media agency churn climbs again, search jobs booming

By Frank Chung | 18 February 2014

After flirting with just over 30% in 2012, the dreaded media agency churn figure has once again jumped, according to the Media Federation of Australia.

The MFA's latest Census and Salary Survey showed the churn rate across media agencies in 2013 was 33.5%, up from 30.4% in 2012, 34.1% in 2011 and 33.2% in 2010. The highest rate of churn was seen among employees with five to 10 years' experience.

While that number is nowhere near historical highs of 41.2% in 2008 and 37% in 2009, it still represents a concern for industry – Mediabrands boss Henry Tajer last year described the 30.4% figure as still "too high".

Overall staff numbers increased 12.2% year-on-year (compared with 12.6% in 2012) with the biggest growth coming from search positions, which were up 55%, and research, up 36%.

The number of media agency employees leaving the industry on a permanent basis was 10% – double last year's figure of 4.9% – half of whom were retrenched or dismissed.

UM chief executive Mat Baxter put the increased figure down to a combination of increased business confidence, some big account moves, and a relaxation of staff and hiring freezes as the market recovered in 2013.

However, he warned that industry-wide churn figures provided "limited value" as the issue has to be dealt with through strong policy and decision-making at a company level.

"Would I be happy with UM having a churn of that level? No, and we don't. So as far as I'm concerned we're in a strong position. But it's difficult for the industry to dictate policy and introduce governance cross-company," Baxter said.

"The other thing that's worth noting is there's such a thing as positive churn – when you want people out of your business. Some businesses when they go through a period of reinvention or transformation, they'll report spikes in churn, but it's not necessarily a bad thing. They're cleaning up the house."

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