Media sector focus: HR during the recession

The recession has hit the media harder than most other sectors, with huge falls in circulation figures and advertising revenues. But decline has not been universal and some companies have continued to expand, partly because of new technology.

 

Digital TV company Sky has expanded its workforce by 70% in the past six years, and research by the Association of Online Publishers (AOP) found half of its members expect to increase their staff this year.

 

The contrast in fortunes is well-illustrated by the BBC, one of the largest media organisations in the world. In its new online areas, staff turnover is high, and the corporation is fighting hard to attract talent, but there has also been a pay freeze for those earning more than £60,000, and levels of churn among journalists is low.

 

Rachel Currie, HR director for journalism and news, predicts tougher times ahead. “If anything, the pressure on us is more akin to the public services.”

Is the media recovering?

Rising share values suggests the need for belt-tightening on recruitment and pay may soon be over. According to financial advisors Grant Thornton, mid-market media companies increased in value by 50% during the last financial year.

The value of shares in these companies, defined as being worth more than £1m but too small to be in the FTSE 100 index, continued to outperform the rest of the stock market in the first quarter of this year.

A joint report by the Advertising Association and media information company Warc predicts total advertising expenditure will increase by 2.3% this year, following a 12% fall last year, the biggest drop since measurements began in 1982. Press advertising was hardest hit, down 23% on the previous year.

Some newspaper circulations have been especially hard hit, partly because of the increasing consumption of online news. In the year to March, ABC recorded falls of more than 16% for boththe Guardian andthe Times. The circulations of the five biggest selling consumer magazines fell by 4.2% in the year to December 2009, according to ABC.

 

 

Recovery

 

Elsewhere, there are signs of recovery, with the share value of media companies rising sharply and advertising expenditure predicted to increase. TV production company Shine is an example of this change, having increased its headcount recently. Although cuts were made last year, redundancies were largely avoided, according to group HR director Caroline Ross.

 

“We tried to impact on other ancillary spend, such as being tighter on expenses and asking people if they wanted to work more flexibly,” she says.

 

The need to innovate has also been encouraged by the changing nature of the media. Currie argues that increasing consumption of the media through the internet and mobile phones means jobs need to be redesigned and organisations restructured. But, she says: “It’s an incredibly interesting time to be working in the sector.”

 

Sky director of talent development Sarah Myers says new technology is changing the mix of core skills needed. “We need to have people working across teams, thinking about how to put the customer first, so collaboration becomes important,” she says.

 

The impact of technology on jobs is being felt in the print media as well. Graeme Roy, HR director at business-to-business media company Reed Business Information (RBI), which publishes Personnel Today, says the past 18 months have been dominated by restructuring, following the closure and sale of some titles.

 

Retraining

 

“A more positive challenge has been retraining to convert people’s skills into the digital way of doing things,” Roy says. He describes the media recession as the worst in the sector’s history, with RBI’s revenue significantly down in 2009. “It will be the fourth quarter of this year before there is likely to be any significant upturn.”

 

TV news provider ITN has also suffered, cutting about 120 jobs in the past two years – about a sixth of its workforce. HR director Hazel Mitchell says: “We have lost contracts, and contracts have been reduced in value – we’ve been hit the same as most organisations.”

 

The company’s response has included a recruitment freeze last summer and a pay freeze this year, which, coupled with a flat career hierarchy, makes rewarding staff difficult. “We don’t have the ability to invest in talent as we would have liked and our turnover is low,” explains Mitchell.

 

“Some of the younger employees have to go elsewhere because senior roles are filled by people who have been here for some time.”

 

Communicate

 

Although there are some positive aspects to this, Mitchell feels the job of her 11-strong team has become tougher. “Some of the nicer, softer sides of HR get put to the bottom of the pile. Through all this we have had to communicate and explain why we are doing this.”

 

This has meant highlighting the positive aspects of working in the sector. At ITN, improvements have been made to health cover offered to all employees, and the BBC has emphasised what Currie describes as its “really powerful training offer”.

 

Using freelancers: the HR challenges

Recruiting freelancers in the media can become a potential minefield. ITN HR director Hazel Mitchell says some individuals can be required to work for long periods. “If you want them to be freelance, you don’t want to create a situation where they become staff. From an HR point of view, it’s a challenge.”

RBI’s HR director Graeme Roy says providing freelancers with phones, business cards and offices can help blur the distinction with permanent staff, while Shine’s Ross argues that legal restrictions make it difficult for companies to embrace freelancers as part of the core workforce.

At the BBC, problems with freelancers have centred on communication. “Our reliance on freelancers has increased but we’ve not had the channels to talk to them,” explains Currie.

This has partly been resolved through an agreement with the media and entertainment trade union BECTU, which has been granted collective bargaining rights in areas where it has sufficient density of membership.

For Sky’s Myers, the biggest challenge is using freelance staff more effectively. She says: “It’s about good resource planning ahead of time and thinking about long-term scenarios. It’s about not having to bring in short-term freelancers under pressure.”

 

 

For her, one of the main challenges has been to keep the workforce inspired and energised. “A huge amount of it is dependent on communication between management and staff,” she says. “Even if we can’t afford as much as we did on pay, we can still offer the kind of experiences that make it a really interesting place to work.”

 

Sky’s rapid growth to a workforce of 17,000 has meant it can select higher calibre recruits than in the past. At the end of this summer, the company is taking on two graduates in its HR department for the first time, with two more to follow next year. Myers believes this will bring fresh thinking to her department.

 

Qualified

 

At the BBC, Currie has noticed better qualified applicants going for jobs in support areas such as HR and finance, with graduates increasingly applying for PA and administrative roles. In-house training programmes in journalism and production have been retained, with each one offering 20 places. These are not necessarily for graduates.

 

In online publishing, sourcing quality staff and retaining them is expected to be a continuing challenge this year, according to the AOP research. Media owners see advertising, editorial, database and data analysis skills as their investment priorities.

 

Anyone starting an HR career in today’s media will have to embrace the challenges thrown up by the current upheaval. But the experience is likely to prove demanding because of the type of people they deal with, according to Currie.

 

She says: “In the BBC and, I imagine, across the sector, the job is relationship based. The kind of people who work in the media are articulate, independent and at ease expressing dissent.”

 

RBI’s Roy, who previously worked in the petrochemical industry, agrees. “They don’t want to be hidebound by processes. They want HR to be free-thinking and flexible, just as they find they have to be.”

 

One quality he says is needed for success in the profession is persuasiveness. “You have to be sure of your knowledge and position,” he says.

 

Building relationships

 

For Currie, the key attribute is an ability to build effective relationships, particularly in areas that are highly unionised. “One of the things I have noticed is that there are fewer HR generalists who are comfortable dealing with employee relations.”

 

The opportunity to experience the full range of HR makes the media an ideal career starting point, according to Ross, who moved to Shine from News International last year. She says: “It’s not just about delivering standard HR processes. You get to work with some of the most creative people in the UK, and they expect you to be much more imaginative about how you engage with them.”

 

 

 

 

 

 

 

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