The nation’s PR agency field did not increase their hourly rates in 2012 according to a survey released this week by StevensGouldPincus, the merger and management consulting firm specializing in the PR field. The results of this survey were consistent with the results of the annual Best Practices Benchmarking report released the end of May.
“I believe this uniform minor decrease in billing rates is indicative of a fairly flat economy and is consistent with little growth of the industry in both net revenues and operating profit,” said Rick Gould, managing partner and director of the survey, in a news release.
Based on responses from 111 PR agencies coast-to-coast and in Canada, billing rates are now averaging $565 per hour for CEOs of agencies with $25 million or more in revenues (up from $517), and $296 among smaller agencies (down from $300), said Gould. Account executives average $150 versus $151 a year ago.
Productivity—measured by billable time utilization—has been far below optimal levels, he said. Senior VP’s are billing out only 64% of their theoretical yearly capacity of 1700 hours, respondents are reporting, he said. And while some rank and file account managers are averaging as high as 98%, 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,” said Gould.
Productivity averaged in excess of 91% for account executives in most of the 14 specialties. “This should be expected of all AE’s not involved in new business and/or management,” Gould added.
The survey is the fifth annual poll focused on billing rates and agency staff utilization by StevensGouldPincus, which has been conducting other industry wide surveys for 25 years including the recently released Best Practices Benchmarking Report. In addition to Rick Gould SGP Partners include Art Stevens and Mike Muraszko, based in L.A.
Edited by Richard Carufel