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Tuesday, June 10, 2014

Starting Salaries in Advertising

Around this time of year, you invariably see articles in the media about starting salaries for recent college graduates across a wide variety of disciplines. Also, without fail, I hear from people saying that actual entry level salaries in advertising appear to be much lower than the reported figures. This year has been no exception.

Historically, advertising agencies paid starvation wages to newcomers. How come? An old acquaintance who serves as Chief Administrative Officer (not her real title) at her shop put it bluntly: “You know as well as I that most people are not suited to the advertising business. It always seems that roughly one-third hate it and quit in the first year, another third cannot do it so we ask them to leave, and finally, the remainder tend to be keepers. So why invest much money in a recruit when the odds are one in three or less that he or she will have staying power? It may seem harsh but with rising costs of benefits, particularly healthcare, we do not pay well at first.”

Another straight talker put it this way: “When the recession hit us in 2008-2009, we got clobbered. We laid off a ton of staffers and I vowed never to be exposed that badly again. So, when we began to staff up in 2009, I made sure that we paid each new employee $5,000 less than we did in 2007. There are no shortages of people applying here and we have not raised the starting salary yet. Honestly, the only problem is that we occasionally get spoiled brats who are heavily subsidized by upper middle class parents. One young lady drives a luxury car in each day and our creative director thinks that she earns far more than she really does. So, we do not have much diversity in terms of backgrounds, but we never pay too much and do not feel bad if someone does not work out. Are we exploiting them? I don’t worry about it as we give these kids a chance when others do not."

A small market CEO writes, “I have not had a raise since 2007. A young kid was here four months and told me he needed a raise to buy a new car. I tried to explain that his means of transportation was not my responsibility. He did not get it and left a few weeks later for a job outside of advertising paying $1500 more. Good riddance!”

In some markets, the cost of living requires better starting pay although New York and other major city rents force newcomers to live with two or three others to make ends meet. Also, many say that real stars go to Silicon Valley or Wall Street and the quality of advertising newcomers is not nearly as strong as it was several decades ago.

Virtually, everyone whom I spoke to or e-mailed admitted that stars do get paid well once they have proven themselves. A few confessed that they wait several years before they loosen their purse strings especially if they are in a small to mid-sized market where changing jobs and staying in advertising inevitably requires a move to another city.

I see both sides of this issue. With many shops facing financial challenges, it does not seem as if we will get a big change soon.

If you would like to contact Don Cole directly, you may reach him at doncolemedia@gmail.com

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