PR firms increased the average hourly rates they charge clients in 2018 from the year prior, according to an annual survey conducted by PR merger and acquisition consultancy Gould+Partners.
The Gould+Partners poll, which focused on hourly rates and staff utilization at PR agencies by size and region, found that the average PR agency billing rate across staff levels—from the president/CEO all the way down to the account coordinators—was $224 per hour in 2018, compared to $206 per hour in 2017.
Billing rates rose for every account function last year, but especially among senior agency staff: Presidents/CEOs billed at an average rate of $410 an hour in 2018, compared to $376 in 2017; EVPs and SVPs charged $367 per hour last year, compared to $346 in 2017; VPs charged $307 compared to $303; account managers billed $258 per hour versus $225; senior account executives billed $210 compared to $208; account executives billed at $174 versus $171; and account coordinators charged $130 versus $127.
Strangely, chief executives at smaller PR agencies saw their average hourly rates go up last year far more than chiefs stationed at the largest agencies featured in the report. Presidents/CEOs at the smallest firms polled—those with under $3 million in net revenues—billed an average hourly rate of $342 last year, a 5.23 percent increase from the average $325 they billed in 2017. Presidents/CEOs at agencies boasting more than $25 million in net revenues—the largest agencies polled—billed an average of $476 per hour in 2018, a 1.45 percent decrease from the $484 they charged in 2017.
The survey also discovered that productivity across PR firms—measured by utilization rate, or total billable hours divided by total available client billable hours for the year—remains below ideal levels.
Presidents/CEOs billed out an average of only 32.4 percent of their theoretical yearly capacity of 1,700 hours, according to the survey, even lower than 2017’s 32.6 percent. VPs billed out 69 percent of their hours in 2018, compared to 69.3 percent in 2017. Account executives logged 85.4 percent productivity last year, down from 2017’s 87.4 percent. Productivity was up, on the other hand, for EVPs/SVPs, senior account executives, account managers and account coordinators.
The report also found that chief executives at PR firms stationed in the New York / New Jersey region billed, on average, far more per hour than agencies in other parts of the country, followed by the Northeast, Midwest, Northern California and Canada (tie) and the Southeast. The same was true for most senior staff positions. Lower-level agency staffers, on the other hand—account executive and account coordinator positions—billed at roughly the same rate across regions.
Gould+Partners’ latest “Billing Rates/Utilization Report” polled CEOs at 41 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, firstname.lastname@example.org, or 212/896-1909.