UK agencies are being urged to redouble their efforts to attract and retain a diverse workforce amid concerns that the drive to overturn the industry’s “white, middle-class” image is losing momentum.
The call to arms follows the publication of the IPA’s 2023 Agency Census, which reveals a marginal decline in the total number of people from non-white backgrounds, both generally and in C-suite roles, while the ethnicity pay gap has widened.
Now in its 64th year, the census shows that total employee numbers within IPA member agencies have stabilised and, as of September 1 2023, stand at 26,630. This represents a marginal rise of 1.3% from the 26,290 recorded in 2022.
Breaking this overall figure down by agency type, the number of employees in creative and other non-media agencies has increased slightly from an estimated 14,643 in 2022 to 14,698 in 2023, while the number of employees in media agencies has increased from an estimated 11,647 in 2022, to 11,932 in 2023.
By gender, the number of males employed in member agencies has increased from an estimated 11,829 in 2022, to 11,883 in 2023, accounting for 44.6% of the employed base, while the number of female employees has increased from an estimated 14,366 in 2022 to an estimated 14,557 in 2023, representing 54.7% of the employed base.
However, while there are more women than men in the industry, this is not reflected in the number in C-suite positions (chair/CEO/MD and other executive management) or in their pay.
And, although there has been a rise in females in the C-suite (up a miniscule 0.4% from 37.5% in 2022 to 37.9% in 2023), men still hold the vast majority (62.1%) of top jobs.
Females occupied 38.0% of C-suite roles in creative and other non-media agencies, up from 36.3% in 2022, and 37.7% in their media agency counterparts down from 39% in 2022.
When it comes to pay, men are still being paid more with a pay gap of 15.2% in favour of males. This is closing, however, with a sharp reduction compared to the 23.3% recorded in 2021 and the 17.4% recorded in 2022.
At 20.5%, the gender pay gap is higher in creative and other non-media agencies than it is in media agencies, where it stands at 8.6%.
While the gap has decreased in both agency types, the decrease is greater for media agencies which stood at 14.3% in 2022 than for creative and other non-media agencies which was 21.1% in 2022.
Even so, agencies are managing to keep hold of their staff longer, despite the cost of living crisis triggering a major job search among client marketers.
At 31.2%, total agency staff turnover is down marginally on the 32.4% reported in 2022. The level of turnover in creative agencies and other non-media agencies was 31.5%, down from the 32.1% reported in 2022, while in media agencies it was 30.8%, down from 32.8% in 2022.
The number of employees working full time in their agency also increased, from an estimated 24,545 in 2022, to 24,910 in 2023, while the number of individuals employed in a part-time role has increased from an estimated 1,746 in 2022 to 1,720 in 2023.
However, there has been a decline in agencies attracting new talent, with the number of first-year trainees and apprentices falling from an estimated 1,387 and 293 respectively in 2022 to an estimated 756 and 288 in 2023.
Individuals from a non-white background occupy 35.6% of entry and junior-level roles, up from the 33.3% reported in 2022.
In media agencies, at junior and entry levels, 39.2% of individuals are from a non-white background, up from 36.7% in 2022, while the equivalent figures in creative and other non-media agencies is 30.5%, up from 27.8% in 2022.
Even so, overall the percentage of employees from a non-white background is estimated at 23.3%, down marginally on the 23.6% reported in 2022. In terms of seniority, individuals from a non-white background account for 11.0% of employees in executive management and C-suite roles, down marginally on the 11.2% reported in 2022.
Among those member agencies providing salary breakdowns by ethnicity and seniority, an ethnicity pay gap of 21.6% in favour of white employees exists – an increase on the gap of 21.1% reported in 2022.
At 23.6%, the differential is higher in media agencies than it is in creative and other non-media agencies, where it stands at 17.3%.
In both instances, the size of the ethnicity pay gap has increased year-on-year, reflecting both the increase in the percentage of non-white employees at junior and entry levels as well as the decrease in the percentage of non-white employees at the most senior levels.
Finally, it seems that hybrid working is a firmly established practice, with nearly three-quarters of agencies confirming they were continuing to use a this approach. More than half (54.8%) use a three-day office/two-day remote model for their workers and a further quarter (27.0%) use a two-day office/three-day remote model.
One thing that has hardly changed, however, is the industry’s age profile; the average age of employees has increased by just two over months from 34.4 years in 2022 to 34.6 years in 2023, while 7% of employees are aged 50+, up by 0.5 percentage points since 2022.
IPA director general Paul Bainsfair said: “After a dip in employee numbers during Covid and then a sharp recovery last year, we are now seeing a levelling out. As such, there are less dramatic improvements this year across key metrics, although some progress in some areas, such as the increase in women at the most senior levels of our business, which is most welcome.
“What is clear, however, with overall numbers of people from non-white backgrounds and numbers of people from non-white backgrounds in the C-suite both declining marginally, is that we mustn’t lose momentum on the great work our agencies have invested in over the past few years to make our business more diverse and inclusive.
“Let’s continue our efforts regarding attracting, retaining, promoting and fairly remunerating our talent.”
IPA director of diversity and inclusion Leila Siddiqi added: “Overall, this year’s findings demonstrate a more settled snapshot of the industry compared to previous years. They also flag, however, that while the percentage of people from non-white backgrounds, at 23.3% of our business, is significantly higher than the ONS’s national figures for the UK’s percentage of 18%, there is a stalling of progress this year in terms of the recruitment, progression and remuneration of ethnically diverse talent.”
“This indicates that extra attention and fair opportunities need to be given here, with possible interventions including insisting on diverse shortlists when working with recruitment agencies or using the Apprenticeship Levy for upskilling.
“By shining a light on areas that need our attention, we can make speedier progress. The richer and more diverse the composition of our industry, the more relevant and interesting we will be for our clients, audiences and modern-day British society.”
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