The Midland PR and marketing sector is steeling itself for a bleak New Year, as it faces further job cuts following a turbulent few months marked by business closures and redundancies.
Fifty-four of Rees Bradley Hepburn’s 140 staff could face redundancy following the loss of the firm’s contract with Jaguar Land Rover Dealerships.
The cuts would add to the dozens of jobs that have already disappeared in the Midland creative sector over the last few months, including redundancies at other big players such as McCann Erickson Communications House.
Rees Bradley Hepburn (RBH) is currently in employee transfer negotiations with the Swindon-based advertising firm that will take over RBH’s Jaguar Land Rover Dealerships contract at the end of the year.
The firm, which has lost the contract to EMO, is involved in transfer of undertaking proceedings and will announce the results of the negotiations next month, but redundancies are not being ruled out.
Elsewhere, brand, design and digital agency Schmakk went into voluntary liquidation earlier this month as a result of what managing director James Cook called “the catastrophic economic downturn,” making ten former staff members redundant.
He said: “Quite literally, it was like a tap being turned off, with marketing spend being the first thing to be cut back in most organisations, which was very much in sync with the plummeting FTSE index.
“Over the last two years, we had committed to growing the agency at significant cost and overhead increase.
“We made the sensible, but very emotionally hard, decision to voluntarily liquidate the company as we cannot see the downturn changing for at least 12 months. We wanted to make sure that we did not impact on our suppliers, who are also not having a particularly good time.”
At its peak, Schmakk employed 21 staff but in anticipating the downturn, had cut back throughout 2008, taking numbers down to ten.
Meanwhile, PR agency Armadillo is to close its’ Nottingham office in January, resulting in four redundancies including three account handlers. Armadillo PR proprietor Catherine Connan said: “We are consolidating the Nottingham office into the Birmingham one.
“It’s fair to say the market has not been brilliant, so we have seen constriction in our fee income. We have gone where the strengths and the client relationships lie, as well as the opportunities for the future.”
The most recent round of job cuts adds to a wave of redundancies made in the sector earlier this year. In October, McCann Erickson Communications House reduced its 230-strong workforce by 18 people following the administration of furniture retailer MFI, one of the firm’s largest accounts.
Elsewhere in Birmingham, property specialists Core made three redundancies earlier this year, including two internal roles and one client-facing position.
Chartered Institute of Public Relations president Elisabeth Lewis-Jones said: “There are stories of redundancies right across the creative sector and the PR industry is by no means immune to the current economic situation.
“However, unlike previous recessions where PR budgets have disappeared altogether, this is not happening this time around.
“Campaigns may be altered and may be more “low-key” if they are felt to be inappropriate during this cautious and difficult time but we have evidence that as a highly-effective business management tool, PR is still deemed as being crucial to managing stakeholder communications and reputations.”