The nation’s PR agency field increased their hourly rates slightly in 2011 according to a survey released this week by StevensGouldPincus, the merger and management consulting firm specializing in the PR field. Based on responses from 105 PR agencies coast to coast, billing rates are now averaging $517 per hour for CEOs of agencies with $25 million or more in revenues, and $300 among smaller agencies, said Rick Gould, managing partner and director of the survey, in a news release. Account executives average $183 versus $178 a year ago. Rates appear to be highest among agencies specializing in sports/entertainment, healthcare and public affairs, among the 13 categories identified, he said. "I believe this uniform minor spike in billing rates is indicative of a marginally improved economy and is consistent with growth of the industry in both net revenues and operating profit," he added. Productivity — measured by billable time utilization — has been far below optimal levels, he said. Senior VP’s are billing out only 66% of their theoretical yearly capacity of 1700 hours, respondents are reporting, according to Gould. And while some rank-and-file account managers are averaging as high as 99%, some are averaging as low as 70%. "The goal for account executives should be at least 90%, a goal reached by almost all firms achieving 20% profitability." The average was 91.6%.
Productivity averaged in excess of 91% for account executives in "every" one of the 14 specialties. "This is a very positive improvement and should be expected of AE’s not involved in new business and/or management.
The survey is the fourth annual poll focused on billing rates and agency staff utilization by StevensGouldPincus, which has been conducting other industry wide surveys for 24 years, including the recently released Best Practices Benchmarking Report.