The post-Brexit vote fall in the pound must be worrying in the extreme for employees of the big foreign-owned marcoms companies – that’s all of them apart from from WPP. It might not be very good for the shareholders in adam&eveDDB, currently in the last stage of their earn-out from American-owned Omnicom.
UK earnings are worth much less now – 18 per cent to be precise – as can be seen in the chart below of Omnicom third quarter earnings – pinched from Campaign – which shows the UK taking a nosedive in money terms even though, at constant currencies, in the UK earnings would have been up.
It’s good for WPP of course as 90 per cent or so of its earnings are from overseas. Omnicom’s Q3 third quarter earnings are up 2.3 per cent, which ain’t great news either.
These things happen with currency markets although not usually as spectacularly as an 18 per cent fall in what was, until the summer, one of the world’s more highly valued currencies. It’s hard to see what new PM Theresa May and her government can do about it as there seems to be no Brexit plan that anyone can make sense of. The three blundering Brexiteers in the cabinet – foreign secretary Boris Johnson, overseas trade minister Liam Fox and ‘Brexit’ minister David Davis – might have seemd like a good joke to May at the time but seem less funny now.
When such things affect adland jobs are lost. With all the holding companies under pressure from slow growth and cost-cutting clients, no wonder headhunters are being besieged by people saying “get me a job at Lucky Generals.”