By Noreen O'Leary

How a host of new agency realities are pushing boomers out before their time

Earlier this month, a judge set a December trial date for a $30 million age-discrimination suit by a Universal McCann media exec, George Hayes, against the agency and its corporate parent, Interpublic Group. Hayes says he was fired by a younger boss who believed young people at the agency "got it" when it came to new media in a way that older staffers did not. In addition, Hayes claims, his former boss viewed "age and experience as a hindrance, rather than a benefit."

The two sides seem ready to go public with the private concerns of a generation of industry execs fearing displacement at a time they should be in their peak earning years.

Valid or not, the contentions of Hayes-a former evp, client services let go at age 53--ring true for a large number of other executives on the street who are arguing their relevance.

Even within the youth-obsessive traditions of the ad industry, there's a new sense of gloom about the career prospects for mid- to upper-level employees. Creative executives, who have obviously always felt the need to. exude a hipness born of cutting-edge culture, now feel it tenfold thanks to the fast pace of digital technologies and emerging delivery channels. Now others are feeling youthful pressures in a media world and larger consumer society informed by technological change. But the issues are more complicated; they're as much about compensation and changing skill sets as they are about tenure. Factor in the current economic downturn and client budget cuts that create an incentive to lose higher-salaried employees, and it's no wonder some in the industry see an overt ageism taking hold that could make a new minority: those over 50.

"Baby boomers always say that 40 is the new 30 [and] 50 is the new 40. In advertising, 50 is the new 65. As soon as you hit that barrier, you're considered old," says Dorothy Higgins, 54, who is consulting after being laid off earlier this year from one of the industry's media companies.

That barrier, in fact, may be dipping even lower. Says one of Higgins' peers: "It's now starting at 40 or 45. Unless you've gotten to a certain stage in your career where you have one of those bullet-proof jobs--where you are extremely key to a client--you're vulnerable."

Not to be discounted in all of this is the fact that with "CMOs getting younger, you have a casting issue," says Nancy McNally, 53, a former top executive at agencies like Ammirati & Puffs and clients like American Express.

Industry observer Rick Kurnit, a partner at law firm Frankfurt, Kurnit, Klein & Selz, agrees that client-casting issues play a role and points out that it cuts two ways. While younger CMOs may relate better to agency staffers in their peer group, he says, older ones look for the agency perspective on new media creative they themselves may lack. There may also be an element of being in the wrong career place at the wrong time. Boomers climbed their careers ranks in a different agency world. Amid new unbundled economic realities, CFOs, demanding that 75 percent of payroll come from client income, can attain cost savings more readily by cutting higher-salaried staffers. The newly empowered client-procurement people look to buy agency hours at cost and young staffers are obviously cheaper. "None of these factors reflect the merits of these [older] people, unfortunately," Kurnit says.

One industry HR exec acknowledges there's a shortage of opportunities for senior people. "The industry's existing bias toward youth and hipness has become more extreme now because of the digital transformation," he says. "The recruiting priority is to find people who are becoming more proficient in digital communications, and the basic assumption is that anyone 50-plus is not going to be that. There's a deep-seated feeling that people of a certain age have a bias toward traditional media--and it can be hard to put them in front of clients for that reason."

The other new reality: The larger contraction within the ad industry. Martin" Kohli, a regional economist with the Bureau of Labor Statistics, says that from May 2007 to May 2008 advertising and related industries lost 11,900 jobs, or 2.5 percent of its employment. Job losses were concentrated in three industry segments: ad agencies, ad distribution and direct mail. (In contrast, public relations and media-buying agencies both managed to increase employment over the year.)

"Looking back, one of the striking things about advertising employment is that after falling from 2000 through 2004 and then growing through 2007, the industry did not get back to its May 2000 level," Kohli observes.

Says Susan Friedman, head of her eponymous recruitment firm: "There are so few job openings anywhere, it's painful. This slowdown is deeper than the one in 1991. It's more like in 1981 and it's going to get worse."

To put that into perspective, during that recession, U.S. unemployment levels, around 11 percent, were higher than any other time in the post-WWII era.

Friedman notes that another challenge in the current job market is relocation. Older execs, with more expensive homes, may not be able to sell their residencies in this real estate downturn.

Some say the industry is merely undergoing a realistic correction in compensation, giving people what they're worth in today's digitally focused market. "I was talking to someone recently who was making $350,000 and now she's willing to make $225,000-250,000," says Friedman. "Five years ago, there were no salary concessions. Your salary was tied to your ego. Now, it's, 'How low can you go?' Creative people with only a traditional background will not get another job in this business, period. But if that person embraces all the new forms of advertising, they'll be worth a lot."

How much more? "If you have 'interactive' or 'digital' in front of your title, you'll be paid 10-15 percent more in compensation," says Amy Hoover, evp at the industry's largest recruitment firm, Talent Zoo. "Traditional shops don't have much of that and they're building expertise."

Recruiters expect creative job candidates for interactive positions to have Web sites with online portfolios or to send links to digital work they've produced. "If someone sends over PDFs or their books for a digital position, you discount them immediately," says Hoover.

And again, it's not just creative execs who may need to recalibrate their compensation demands. "There are an awful lot of people of a certain age out of work right now," says one industry leader. "I don't think it's solely the fault of agencies. [These unemployed execs] need to reconfigure their expectations."

Indeed, among out-of-work execs who spoke to Adweek, one was willing to take a 50 percent reduction from a peak earnings period in order to land a job. Another was willing to be more flexible on terms, opting to take a 20 percent pay cut, work four days a week for less pay or take a lower wage, with bonus.

Nonetheless, there's concern about a devaluation of experience. One senior-level media exec, let go during a downsizing, describes a current opening for a leader of global media strategy for Visa--a top-level job requiring considerable coordination within the client organization as well as management of outside agencies, The salary base is $150,000, with experience requirements of seven to 10 years. Previously, a job like that would have a base of $185,000-195,000 and require 10 years of hard-core media experience, the exec argues. One Manhattan headhunter concurs, sniffing at the compensation package: "The base and experience for that will work in Kansas, not New York."

Recruiters also say that employers often pick staffers with less experience than they requested. "People say they want someone with 15 years experience and then they pick a person with six years," says one. "I suspect they just wanted the younger people all along, but it would be illegal to say that."

Indeed, recruiters say there's a new employer shorthand for candidate requests, with terms like "rising star" and "up-and-coming" used to skirt legal issues.

"They mask it by saying they want someone with a lot of energy, a lot of technology or digital, but I know what they mean," says one source.

While creative and media execs of a certain age are bearing the brunt of the industry's digital change, the game has changed in account management as well.

"It used to be a lot simpler: So and so grew up at Y&R or O&M, has telecom experience, lots of client skills. That's a thing of the past," says one industry recruiter. "Five, 10 years ago, if you were the perfect car guy, P&G woman, you had a resume everyone wanted. It's different now; that consistency, and loyalty is not rewarded any more.

"It's a big problem. If you're 45-plus and worked your entire career in an ad agency, you're going to struggle if you don't change," she continues. "You must become an early adopter… We want diverse work experience, people [who are] digitally fluent or open to becoming so, and that's where people 30 or younger may have the advantage.… If you're not willing to change now, you'll be extinct in five years."

But that reinvention may not be so easy. Jeri Dack, a 58-year-old media exec who has worked at agencies like DMB&B, MediaVest and MPG, got her first real taste of digital while serving as director, digital media at TargetCast and is now refocusing her career in that direction. With a diverse industry background, Dack is not used to being held back when trying something new.

"I've never felt discrimination before, gender or age," she says. "Now I feel resume discrimination. You either have to be young and working in digital or to have had your start in digital. People like me go out and are interviewed by a person who is 30, with their feet on the desk, who says, 'You've only been doing this for 18 months.'"

Dack sounds more frustrated than bitter, as did others interviewed for this article. That's not to say there have not been humiliations. Some have been let go by younger bosses only to have their former positions slightly changed and filled with younger, cheaper staffers. Another tells of receiving a call from a contract freelance company for a last-minute new-business pitch and being offered $40 an hour--about a quarter of what she gets on the open market. Others describe freelancing in new-business pitches with the knowledge they're good enough to win the account, but not likely to be hired after the agency lands the business.

Many digital practitioners, however, lack the integrated vision and skills of those more traditional media execs.

"My big frustration is that digital agencies that do creative barely have any understanding of digital media and no understanding of marketing," observes Dack.

Says another unemployed media veteran about her last job: "I said to a [younger, digital] colleague, 'I'd like to work across clients and build a much more robust program across media.' He said, 'That's fine, as long as you understand the purpose is to drive traffic to the Web site.'"

Within digital shops, some more-senior execs have found it a difficult cultural mix with aft office full of predominately younger staffers. One exec, let go from her job earlier this year, said at age 39 she felt it was frowned upon when she left at 6:30 p.m. to go home to her family. Her colleagues, many of them living with roommates in Manhattan apartments co-signed by parents, would hang around the office and then head out to a local bar and do shots together.

"When you have kids, you learn to be efficient," she says. ''You get into the office early, eat lunch at your desk and not go out to two-hour media lunches or spend two hours on Facebook. I'm in the suburbs with a mortgage and kids. We didn't have much in common and I felt like an outsider."

After being laid off, the exec interviewed at some other digital shops and encountered more of the same: bosses and colleagues in "Teva sandals, tattoos and piercings. That's not me, not my culture," she says. She's now in the process of setting up her own consultancy. (Other laid-off media execs say they're focusing their job searches outside the industry to content providers who appreciate their experience and background.)

The exec, realistic about why she thinks she was let go, says agencies are gambling with young people of limited client experience: "OK, you can change the job title or description and get one of them for $50,000 less and they're OK if everything is going well. But when there's a problem, you need someone with experience to face it and say, 'This is how we fix it.'"

Adds Dack: "The easy part in this industry is learning a discipline. The hard things are client management, collaboration, strategy, mentoring and teaching."

Bob Greenberg, the 60-year-old founder of interactive agency R/GA, understands the frustrations of his more-traditional industry peers. He admires their skills in client management, creative and strategy, all of which, he says, is as relevant to R/GA as it is elsewhere. But he notes that companies like his can only take on so many of those execs and retool their skill sets.

"There's a lot of agency musical chairs happening right now and there are more and more people 40-plus left without a chair when the music stops," he says. "They. can't retire, but they're not trained for digital and their salary range is high. We're competitive with traditional agencies when it comes to pay, but it also means when we hire them it takes a year to train them from an investment perspective. A younger person aged 25-32 already knows what we do. They live a digital, multi-channel life already and you don't have to train them."

Former Ogilvy & Mather North American CCO Rick Boyko, 59, now the head of the VCU Brandcenter, says he left the business five years ago after his frustration at not seeing it change quickly enough. Agency execs that have fallen out of step with its transformation, he says, may have only themselves to blame.

"I don't think there's a new kind of ageism in our business today," Boyko says. "It's always been, and always will be, a young person's business. We help shape and create culture. To do that you have to be in tune with the culture of the time. Culture almost always comes from the streets and clubs of inner cities, yet most agency execs move to the 'burbs and do not stay in touch with what's going on. They become comfortable and complacent. They stay in the same job for too long. To stay current in this business, you have to kick yourself in the ass and challenge yourself."

KEY INSIGHTS

New casting issues are arising with clients who assume agency executives of a certain age harbor a bias toward traditional media.

A compensation correction is under way: Traditional execs will have to be more realistic about what they're worth, while hybrid thinkers and digital staffers are in big demand.

Employers are finding new ways to mask age bias as they select candidates with less experience than is required for the position.

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