Last week, R/GA reportedly laid off 10% of its team across U.S. offices. Globally, the agency employs more than 2,000 people. In the United States, R/GA has offices in Austin, Chicago, Los Angeles, New York, Portland and San Francisco.
According to the story from AgencySpy, the layoffs were effective Friday May 1. Terminated employees will receive severance pay and healthcare benefits until the end of this year.
Other cost-cutting measures the IPG-owned agency has taken include 10% pay cuts for executives, reduced work schedules for teams that aren’t client-facing and short-term furloughs for “facilities staff,” or people who help clean and maintain its offices.
“COVID-19 has forced a lot of companies like ours to make these very difficult decisions, but it was important to us to be able to take care of the talented individuals leaving us,” Sean Lyons, global CEO of R/GA, said in a statement. “While some of what we’re doing for our clients has changed, we’re still hard at work, and have found that R/GA’s natural resilience and range have helped us to deliver for those clients in new and unexpected ways. We remain grateful to all of our clients for trusting us to protect and grow their businesses.”
R/GA’s cost-cutting measures follow IPG CEO Michael Roth‘s announcement earlier this month in an internal memo. Roth said the holding company’s agencies are implementing “deferred merit increases, freezes on hiring and temporary labor, major cuts in nonessential spending, furloughs in markets where that option is available, salary cuts and, unfortunately, reductions in staffing levels.”
Chicago Office to Close?
According to advertising app, Fishbowl, there is currently chatter and unconfirmed reports that the Chicago office is closing. This report also appeared in the AgencySpy story.
UPDATED: A spokeswoman for R/GA told Reel Chicago that the Chicago office “was affected more than others, but there are currently no plans to close.” Stay tuned…