Temporary pay cuts emerge as adland's key measure for weathering storm of pandemic

Businesses in adland are turning to temporary cuts in pay and hours for their staff as a key tool for mitigating the financial impact of the coronavirus pandemic, Campaign research suggests. 

Out of 1,640 registered users of Campaign UK that took part in a survey online, 37.7% said their job had been affected in some way by the coronavirus outbreak. 

Of this group, two in five (40.5%) said they had been asked to take a temporary pay cut, while 17.4% said they had been asked to reduce their hours – a step likely to be accompanied by a pro rata pay cut.

In contrast, only 23.9% said their role had been furloughed or subsidised by a government scheme.

A further 18.2% said they had been placed at risk of redundancy – although the intention of the Coronavirus Job Retention Scheme, in which the government will pay 80% of salary up to £2,500 a month for staff not currently working, is to help businesses avoid redundancies wherever possible.

One London agency chief executive told Campaign that while furloughing was an option in some cases, it was "limited in its use" for agencies because of the diverse workload of most staff, who typically work across multiple clients and projects.

He said the scheme was primarily meant for business such as restaurants, in which staff cannot work at all due to closure. 

Of the poll respondents who said they had not been affected so far, three in five (61.1%) said they did not expect the situation to change. But a fifth (20%) said they expected to be asked to take a pay cut and 8.7% anticipated a reduction in hours. Only 6.1% expected to be furloughed, while 4.1% expected to be placed at risk of redundancy.