While speculation on the impact of AI on junior roles is widespread, Spinach’s Ben Willee reports that outsourcing to cheap offshore outfits is costing jobs right now.
With budgets shrinking and margins narrowing, every agency in town is looking for a way to cut costs. While AI and automation are hogging the headlines, there’s another approach that’s been playing out in the background for decades: outsourcing.
What started with IT and call centres has now crept into the creative and media world.
Across the industry, many multinational agencies and, dare I say, some of the bigger indie agencies are quietly moving junior roles offshore. And I’m not talking about agency teams in far-flung countries. Instead, think freelance help desk-type talent, run by cheap labour hire outfits.
My sources tell me that at least two major holding companies have been outsourcing entry-level media positions for more than a year. One agency has reportedly got a labour hire hub in India where every task goes into a ticketing system before being assigned to whoever is available.
Campaign setup, trafficking, reporting, and even bits of creative production are being done by people who have never set foot in an Australian office.
One marketer I spoke to recently cottoned on to the fact they weren’t getting what they had paid for. The retainer they’d been forking out for a person in Australia’s salary of X had been reduced to Y without a heads-up.
Another needed to make an urgent change to a campaign, only to be told that, given the time difference, the team responsible wouldn’t be online until later that day. They’d simply have to wait.
On paper, outsourcing looks brilliant. The client (sometimes) saves money, the agency pockets a bigger margin, and everyone calls it efficiency. But in reality, it’s more short-termism than a goldfish with a gambling problem.
It’s a tragedy for our industry because every time a local junior role disappears, so does a bit of spark, curiosity and learning. Work becomes more transactional. When everything is done over screens, people stop hearing the debates, the jokes and the “aha” moments that make this business tick.
It’s like replacing a chef with a microwave. You’ll get something hot, but it won’t taste the same.
Yes, it’s cheaper to offshore. But if agencies continue to outsource our most junior roles, we will lose the next generation of thinkers. Those roles are the training ground where people learn how the whole machine works. When all you see is a to-do list on Slack or Monday.com, you never learn the “why” that separates good from great.
Our industry claims people are our advantage, then it ships half the learning overseas. That’s not strategy. That’s self-harm.
By hollowing out our local pipeline, we’re setting ourselves up for a massive talent shortage. In five years, the same agencies that offshored junior work will be fighting to hire mid-level people they didn’t train. Salaries will jump, capability will drop, and everyone will wonder how it happened. Spoiler alert: it’s happening right now.
Worst-case scenario, if the business case for outsourcing becomes industry-wide, we’ll end up with no pathway into adland, and there will be no one at all to hire.
If you’re a marketer reading this, you should be concerned. If the people working for your agency have never seen your store, watched your TV ads or interacted with your brand, how can they understand your customers? Sure, procurement loves a cheaper hourly rate, but what’s the real cost when your agency becomes a glorified traffic controller for overseas production teams?
While the onus is on agencies to stop eating their own tail, client-side marketers can also play a role. During the pitch process, ask your prospective agencies how many of the people working on your business actually work for the agency and how many are offshore. Ask those prospective agencies what their policy is regarding outsourcing, and if you’re not comfortable with the answer, take your business elsewhere.
When it comes to your current agency, if you suspect they’re outsourcing the work, push back.
If everything ends up going into a nameless, faceless pool, the standard will slip since no one can guarantee the same level of training and care from the person working on your business.
Efficiency is good. Blind efficiency is not. We need to protect the spaces where people learn, argue and grow because that’s how great work happens.
It’s up to all of us – agencies, clients and procurement – to resist the race to the bottom. If we don’t, sure we’ll save a fortune. But we can kiss quality goodbye.
