Holmes Report 01 Aug 2016 // 9:52AM GMT
NEW YORK—North America’s PR agencies did not increase their hourly rates in 2015, according to a new report released by Gould+Partners, the merger and management consulting firm.
Based on responses from 106 PR agencies based in the US and Canada, billing rates are now averaging $448 per hour for CEOs of agencies with $25 million or more in revenues and $301 per hour among agencies with under $3 million in net revenues, according to Rick Gould, managing partner and director of the survey.
Productivity—measured by billable time utilization—has been far below optimal levels, Gould said. Senior VPs are billing out only 58.9% of their theoretical yearly capacity of 1700 hours, according to the survey.
And while some account executives are averaging as high as 95%, others are averaging as low as 70%. The average for the second year in a row was 89.0%, which is close to target. “The goal for account executives should be at least 90%, a goal reached by almost all firms achieving 20% profitability,” Gould said.
Productivity averaged less than 90% for account executives in most of the 14 PR specialties tracked. "At least 90% should be expected for account staff not involved in management and new business,” Gould added.