A wise man once said that landing a good job in Hollywood was nearly a mathematical formula: 90% luck, 10% good luck. That formula applies today, even as the entertainment industry emerges from an era of widespread job reductions.
The recent bad days of job scarcity evolved from an ugly confluence of events: dot-com/high-tech meltdowns, the 9/11 attacks and another round of consolidation of media and entertainment companies.
Companies had been adding jobs and overhead at a staggering rate. Management tolerated expansion because the economy seemed to warrant it. When the bubble burst, the media conglomerates were more than eager to prune their head count.
“Downsizing” became the euphemism of the day for people being fired. At a certain point, however, corporate downsizing became corporate anorexia.
As staffs shriveled, those who remained were obliged to do more and more work. Workplaces were functioning on an emergency footing. When a true emergency reared its head, the workers often were too spent to rise to the challenge.
How do I know this? I know it because I’ve had hundreds of conversations this year with executives who’ve been involved in hiring and firing situations, who’ve called me in a state of panic or burnout, who were doing the work of three executives.
Another near casualty was the concept of corporate loyalty. Many of the firings were done in a cold, almost robotic fashion. To be fair, the companies were mindful of the litigious nature of our society, and so this nasty activity needed to appear to be equitable, which did nothing to endear the remaining employees to the company.
But some companies began to view their employees as an obstacle to prosperity rather than as a means by which to achieve it. The companies didn’t trust their employees and the feeling was mutual.
But there’s evidence that the job market has bounced back:
Revenues at the 25 U.S. executive recruiting firms are up an estimated 18% over last year through Sept. 30, according to Hunt-Scanlon Advisors in Stamford, Conn.
Recruiters’ average placement fees – typically a percentage of a new hire’s first year’s estimated total compensation – have risen 30%-35% this year, indicating that recruiters are helping to fill higher-level openings than in the past few years.
Virtually all the major executive search firms had substantial increases of revenue in the third quarter of this year – some more than 25%. True, this is a reflection of hiring on a senior level (generally $ 200,000 salary and up). Nevertheless, the search firms also serve as harbingers of what’s in store. There is definitely a trickle-down effect when it comes to jobs.
The latest wave of hiring has not affected all areas equally. There’s been real job growth in the videogame business (witness Electronic Arts’ announcement of “an aggressive hiring campaign”), cable programming services, satellite delivery services and the tech sector. There’s been less hiring in the music industry and theme parks.
The latest cycle of job growth also is getting a boost from the fact that leading investment and merchant banks, equity funds and other investors are becoming active again. This is not only a function of major investments such as Sony’s acquisition of MGM, but also of smaller investments in startups and second-stage media companies.
In the entertainment business, action often begets action. When it comes to hiring, the large companies and studios are historically reluctant to be the first, but they’re downright panicked about being the last. Gearing up for new opportunities requires an open-mindedness to hiring. Inertia is a powerful force, but it can be overcome.
The bad old days are not completely over. Unforeseen events, like a recession borne of an oil crisis or other global mishap, could arrest the burgeoning economic vigor. Nevertheless, present indicators suggest the hiring freeze has begun to thaw.
Unger is a leading exec recruiter. At various times, he led the media and entertainment practices of the world’s three largest executive search firms. He can be reached at firstname.lastname@example.org.