A look back on 2021, and a peek into 2022

If we thought 2021 would settle down after a tumultuous 2020, we were wrong. The business world is still reeling, this time from a labor crunch that’s affecting everything from supply chains to restaurant service.

It’s a time of great uncertainty for many companies: each month more than four million US workers resign. Those resigning are mostly mid-career workers, and they take with them the skills that keep a company going on a day-to-day basis. Complicating matters further, 48% of employees surveyed by Gallop say they’re actively looking for another job, putting business continuity at risk.

How are companies pivoting to adapt to these post-pandemic challenges? Paragon Digital Services has a unique perspective on some aspects of labor shortage, as our teams are asked to step in and fill gaps as they arise.

Here our observations gathered over the past year, and what we see in store for 2022.

Outsourcing fills in skill gaps 

Outsourcing various aspects of business operations has been on an upward trajectory for more than a decade, but the pandemic has accelerated the trend.

As workers reevaluate their priorities and assess how to achieve a work-life balance that’s right for them, hiring managers are panicking. It’s not uncommon to see $5,000 sign-on bonuses offered for entry-level positions and warehouse workers. And the fear that once they invest in recruiting, those workers will be lured away by a competitor.

In 2021, companies engaged outsourcing partners as a stop-gap measure, but that fix is increasingly seen as more of a permanent solution, or at least until such time when recruiting costs come down a bit. Those who hope to eventually bring functions back in-house are keen to work with outsourcers who can transfer skills to newly hired employees.

In-housing plans slowing down or put on hold

Prior to the pandemic companies have been bringing various marketing activities in-house, but those efforts have slowed down. In-housing is proving expensive and its rewards are harder and taking longer to realize, prompting many brands to hit the pause button. “Many advertisers are being more selective about how they want to work with agencies and are prioritizing flexibility and capability over scale and stability,” write Kimeko McCoy and Seb Joseph in Digiday.

Many companies are continuing their push towards in-housing, but they want to focus those efforts on the strategic work, and leave the more technical aspects to outside experts like Paragon’s trafficking teams. Some see this approach as a strategy to retain employees who want more interesting work. For others, candidates with the needed technical skills just aren’t available in their areas, so they have no choice but to outsource.

Enabling full-time employees to focus on strategic work is a good way to combat the Great Resignation, as many people have quit in order to pursue jobs that give them a greater sense of fulfillment.

Operations still seen as prime outsourcing candidate

Business process outsourcing (BPO) has been on an upward trajectory for the past 20 years and is showing no signs of clowning down. In 2022, the global BPO market is valued at $232 billion, and will grow by 8.5% each year until 2028.

Advances in SaaS, platform as a service and infrastructure as a service give companies a lot more flexibility to outsource some or all of operations to a partner.

Looking ahead to 2022

So what’s ahead for outsourcing, particularly as it applies to the media industry?

We’re likely to see hybrid models, with companies looking for outsourcing partners willing to take on a portion, but not all, of their workloads. Companies want partners who can augment, not necessarily replace, their internal teams.

Outsourcing engagements will start out small, but will increase as clients see tangible benefits. This is a trend we see currently, and expect it to continue, especially as managers strive to provide more meaningful work for their employees in order to retain them.

If the Great Resignation continues at its current rate, outsourcing will become an important strategy to maintain business continuity. In some cases, outsourcing partners will be asked to perform more niche work.

Rising recruitment costs, higher salaries – along with the scourge of luring trained away from current positions with competitive offers – may lead more companies to seek outsourcing partners as a more permanent solution.

Get in touch today to learn how we can help you transform your ad ops as we head into 2022.

Author:David Tyler

Date:7th December 2021


Why agencies should embrace remote workers

Advertising and media agencies, like companies everywhere, are experiencing a labor crunch. With hundreds of open recs and few candidates to choose from, agencies are facing the prospect of turning down work because they don’t have the staff to do it.

One way to solve the labor crunch is to embrace the concept of remote workers. Not only will it solve the short-term recruitment challenges agencies face right now, but it’s entirely likely that remote work is the future of employment, and those agencies that don’t allow it will find themselves at a competitive disadvantage.

The Great Resignation of 2021

We are living through an extraordinary time, by any measure. The pandemic forced people to work from home and to cancel all social activity. As a result, they had plenty of time to think about big issues, such as what they wanted to get out of life, and how much of their time they wanted to dedicate to work. Many knowledge workers moved out of the city to escape the pandemic, only to discover they liked having more space and appreciated the lower cost of living. Why return to the rat race just to afford expensive housing?

Beginning in April 2021, just as companies were beginning to make plans for their employees to return to the office, the Great Resignation began. Over a three month period, 11.5 million American workers quit their jobs. Of those still working, 48% told Gallop that they’re actively looking for other work.

What are they seeking when they quit? Many say they’re in search of more free time and happiness. The cultural shifts of the past year, combined with economic upheaval caused by lockdowns, have fundamentally changed the way employees want to work.

Remote work is a top priority, and 70% of American workers said they’d happily forgo benefits —  including health insurance paid time off and retirement accounts —  in order to continue working from home.

Today we see a global labor shortage in every sector, from retailing, restaurants and service industries, to ecommerce developers, marketers and agency personnel.

Ad agencies struggle with The Great Resignation

Advertising and media agencies are far from immune to the Great Resignation. Many have hundreds of open positions they can’t fill, and ad professionals continue to leave the industry.

A survey of 423 marketers and agency employees found that 63% plan to change jobs or careers this year, 40% demand flexible hours, and 100% — every single respondent! — said they would not consider a job that didn’t offer the option to work from home.

Their reasons for quitting mirror those of other knowledge workers. Digiday interviewed seven people who left their agency jobs without having another one lined up. A desire for a better life/work balance, and too much work without a sense of satisfaction were some of the reasons given.

Business response

Across the industry, business leaders are responding to employee demands by offering more flexibility. Many are opting to give up big offices that accommodate the entire workforces in favor of multiple satellite offices in areas that are closer to where employees live. The goal is to allow employees to mostly work from home, but to provide a space for weekly or biweekly team meetings.

And full-time work from home is still on the table for many big corporations. In September, The Conference Board released a survey of more than 330 HR executives at large companies, and found that they are 3x more likely to hire remote employees; 36% are willing to hire people who are fully remote and located anywhere in the world.

Will agency executives join their peers in other industries and meet their employees’ demands for flexible work schedules? It certainly would be wise to do so, especially since we urgently need to stem the employee exodus from the space.

Remote work works

Paragon Digital Services can offer insight into the questions on how to run an agency efficiently when workers are remote. As our critical teams are widely dispersed, the single most important factor is having a deep understanding and high priority on processes. When we take on clients, during the onboarding phase, every single process is written down and mapped to KPI, in precise detail, so that each employee knows what is expected of him or her.

Our investments in mapping each business processes have paid off in numerous ways. Ad operations work done remotely by Paragon has lead to efficiency gains ranging from 20% – 30% and accuracy rates (error free work) above 99.9%.

The final reason to support remote work: employees say it’s critical to their quality of life. Companies can stem attrition by enabling their employees to achieve the right work/life balance, and by assigning employees to work that provides them a sense of satisfaction which leads to  opportunities for meaningful growth “within” your organization.

Interested in discussing our offerings further? Get in touch.

Author:David Tyler

Date:12th October 2021