Finding and keeping talented employees is one of the key struggles of every digital agency. A large part of staff attraction and retention is the overall compensation package that an agency can offer. Many agency owners and managers are wrestling with questions around pay structures and employee benefits and how to find the right balance for their employees and the business’s overall profitability.
A recent study focusses on this area. This study, a joint project between the Bureau of Digital and Promethean Research, tries to understand how digital service firms compensate their employees and owners, and to examine how it relates to the firm’s overall profitability and revenue growth.
The study surveyed 67 different digital service firms from 24 countries and collected their responses in a Digital Services Salary report.
According to the report, the digital services industry is in a healthy state with everyone expecting their business to grow. Owners are optimistic about the future, reporting an expected average top-line growth of 17% for 2019.
The survey responses also highlight the importance of experience: based on the findings, each additional year of experience is worth approximately a 4.5% increase in salary.
In terms of headcount growth, the study shows that owners expect to add significantly to their company’s headcount in 2019 with average headcount expected to increase 22% year on year. Studio firms (less than 10 employees) plan to expand the most this year with expectations of a 31% growth in headcount.
Remote work is also a hot topic at the moment, with more agencies offering remote working opportunities for new and existing staff. On average, the report shows that remote employee salaries were an average of 23% higher than in-office employees.
Carl Smith, founder of the Bureau of Digital, says:
“As talent becomes increasingly harder to find, leaders in digital have to embrace the idea of remote employees. Not only does it increase the universe of applicants infinitely, but on average distributed employees are twice as experienced as their in-office counterparts at an increased expense of only 23%.”
Another interesting aspect of the study shows how agencies are specialising their service offerings. Larger agencies are, unsurprisingly, more generic in their offerings, whereas smaller firms are more likely to be super-specialised on a specific aspect of digital services.
The full report contains many more insights that can help agency owners make informed decisions about the salary ranges and benefit packages that their employees expect. It also looks at areas like billable hours, service offerings, and employee turnover rates.
The full report is available on the Bureau of Digital website here. While the full report requires a Bureau of Digital membership, a summary of the report with its key findings is available for free.