The Ad Market

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It's not a happy new year for agencies. While the recession may be over, one measure of the advertising market-agency employment-continued to fall into the new year. U.S. ad agency employment in January fell to the same level as January 1999, before the latest boom began. But the month-over-month rate of decline held even in January, indicating the rate of fall has stabilized. Agency employment in the 1990s bottomed at 148,500 in May 1994; staffing peaked at 202,300 in August 2000.

Good news travels: The starter's pistol for the recovery went off last week, with more encouraging statistics from the Federal Reserve Board (higher industrial production that hints at a manufacturing recovery) and the bellwether University of Michigan consumer sentiment index, which rose to its highest level since December 2000. The good news had to fight off continued concerns about weak corporate earnings. For the week, 33 AdMarket stocks were up and 17 were down.

While experts say ad spending still has a way to go, early recovery calls (see story, this page) helped media stocks. Agency stocks remained depressed since most recovery forecasts carried a caveat that the next two quarters could still be troublesome.

Advertising Age and Bloomberg's AdMarket 50 index of 50 top publicly traded marketers, agency and media companies for the week ended March. 15, 2002, based on stock trading data supplied by Bloomberg financial news service. All comparisons are based on closing prices March 8.

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