Is AI Responsible for Recent Ad Industry Job Losses?
Last week AdAge published an article with the headline "US Ad Business Lost 1,200 Jobs in August, the Sixth Drop in Seven Months." It’s based on Bureau of Labor Statistics employment data, which was recently revised downward. It caught our attention partly because we just finished conducting a survey of marketing and ad agencies.
This is a very large and important industry to Dialog and its members. And we've directly and indirectly tracked its evolution for roughly 25 years.
The chart below shows employment levels in the "US advertising, public relations and related services" category. Since January 2022, the industry has added some 52,000 employees, an increase of 11%.
Ad Revenues Are Up, But ...
The AdAge headline focused on the fact that the industry has lost employees consistently for the past six months, which is striking because early 2024 ad spending forecasts were very bullish and the major ad platforms have seen meaningful double-digit revenue growth throughout 2024.
All this got us thinking about the causes of these job losses. The article offers a number of theories: macroeconomic trends, tech layoffs and job losses in adjacent industries. But we're also prompted to ask whether AI adoption may be a contributing factor. Agencies have been early adopters of AI tools and technology.
