PR firms, on average, increased their hourly billing rates last year from 2016, according to results from an annual survey conducted by PR merger and acquisition consultancy Gould+Partners.
Average billing rates for all account staff in 2017 — from the president/CEO all the way down to the account coordinators — was $206 per hour, compared to $196 in 2016.
Average rates and utilization, 2017 versus 2016.
Rates for virtually every account function have gone up, but especially so among senior staff: CEOs and presidents charged $376 per hour last year, versus $355 in 2016; EVPs/SVPs charged $346 per hour, compared to $324; and VPs charged $303 compared to $273. The only outlier in this regard were account managers, who maintained a flat average rate of $225 per hour.
Senior staff are billing more, but when it comes to account staff productivity — which is measured by billable time utilization — that number creeped down in the past year for account teams’ most senior staff members.
Presidents/CEOs billed out an average of only 32.6 percent of their theoretical yearly capacity of 1,700 hours (compared to 2016’s 33 percent), and EVPs/SVPs billed out 53.5 percent (down from 2016’s 54.7 percent), according to the survey.
However, Gould+Partners managing partner Rick Gould told O’Dwyer’s that the productivity of CEOs and EVPs can’t be seen as accurate benchmarks, given that much of their time is spent on new business and management.
On the other hand, productivity was actually up for staff on the bottom end of the hierarchy pyramid. VPs billed out 69.3 percent of their hours in 2017, compared to 67.3 percent in 2016. Account managers logged 78.8 percent, versus 2016’s 76.4 percent. Account coordinators revealed productivity of 86.6 percent, compared to 2016’s 81.1 percent. And account executives exhibited the highest productivity of all, billing out 87.4 percent last year, according to the survey.
"The real news," according to Gould said, “is that utilization/billability is going up at the staff levels.”
“What I look at is trends with VPs, account managers, account execs and account coordinators. These are the staff levels that produce the majority of the billable work,” Gould said. “Higher level executives should be doing more ‘strategic, big picture billable work’ and maintaining client relationships. The goal for all firms should be that the CEO/President not spend more than a third of their time on billable work.”
Still, Gould told O’Dwyer’s that 90 percent should be the minimum expected productivity rate for account staff not involved in management and new business.
Gould+Partners’ “Billing Rates/Utilization Report” was based on responses from 35 selected “best of class” PR agencies based in the U.S. and Canada.
Copies of the survey are available on request by contacting Rick Gould, email@example.com, or 212/896-1909.