Ogilvy Cuts 150 Jobs; First of "Thousands" Expected at WPP

Last Updated Jan 7, 2009 2:19 PM EST

The Ogilvy Group cut about 150 staffers today, about 10 percent of its workforce, according to Adweek. The move had been predicted by Ad Age yesterday. The job losses come on top of 50-100 staffers laid off last year.

The layoffs are likely the first of a wave of thousands that will go through many WPP agencies. Network boss Martin Sorrell said there would be cuts to mature parts of his company -- which would include the likes of Ogilvy & Mather, JWT, Y&R and Grey -- in 2009.

Also under the spotlight is Enfatico, the agency that WPP created to serve Dell only. Dell is currently in a cost-cutting drive.

WPP was denying there would be layoffs as late as two days ago.

Reports out of the UK suggest that Sorrell wants to see staffing costs at agencies reduced to 60 percent of the revenue they produce. At comparable networks that break out staffing costs, salary expenses tend to be about 67-75 percent of revenues. WPP does not break out its staff costs.

In a ranking of agency network productivity, WPP came in the middle of the table. The layoffs bring BNET's Ad Agency Layof Counter to 6,546 in recent months.