Digital Pulse Analysis March 2008
Background
Digital Pulse is a confidence index for the digital industry. It is designed to find out how industry professionals are feeling, how they perceive the current business climate, salary conditions and their views on what it’ll be like in 6 months time.
Each month, Chinwag will poll its community, made up of practitioners working across the digital industries, to create a barometer of attitudes and confidence.
The indices for Digital Pulse will be released each month, with a detailed trend analysis undertaken each quarter. This report details the findings of the inaugural survey conducted in March 2008.
Index
- Background
- Executive Summary
- The Digital Pulse
- Current market conditions
- Future conditions - six months from now
- Employment, Recruitment & Salary
- Conclusions
- Methodology
- About Chinwag
Executive Summary
The first Digital Pulse provides an initial benchmark of confidence across the digital industry. Subsequent surveys will allow more detailed analysis of trends within the industry.
The Digital Pulse index for March 2008 is:
Overall index suggests a positive view of marketing conditions for digital businesses, where 100 equals a neutral response on a sale of 0-200.
- Digital industry wears credit crunch concerns lightly:
- 72% positive or very positive about current market conditions with an index of 145.7.
- Digital recruitment flying high
- Confidence in current employment opportunities is high with an index of 152.3
- Confidence in the future falling
- Respondents have less confidence with conditions in six months time, with the index falling by 8% to 133.6.
- Permanent staff more confident than freelancers
- Freelancers were 12% less positive than permanent staff, with 18% of freelancers negative about prospects in six months time.
- Agency sector boasts highest confidence
- Web and advertising/marketing agencies most confident in both current and future market conditions with a 77% positive response to the present climate.
- Online publishing least confident
- This sector has the most negative view with 36% giving a negative response to current conditions.
- Recruitment market fluid
- 25% answered positively about the likelihood of moving jobs in the next six months. Client side staff most likely to be moving.
- Industry rife with high salary expectations
- 62% felt that their salary didn’t reflect their true worth.
The Digital Pulse
The Digital Pulse for March 2008 is:
The results of the overall index indicate a positive outlook towards the current market position, with good confidence about the current market state and the wide availability of jobs within the market. Looking over the next six months however, this confidence slips 12.1 points (8.3%).
The Indices
The individual indices that make up the Digital Pulse are:Summarising these indices provides two further indices that show confidence in the current climate and six months from now:
Return to Index
What is a confidence index?
The Digital Pulse is based on a consumer confidence index and reflects the degree of optimism or pessimism that people working in digital media feel about the industry. It is useful for business development forecasting, company growth projections and gaining a high-level business view.
The index is normalised to a score of 100 and is adjusted monthly on the basis of the poll that is taken on Chinwag’s website and through partner distribution channels. A score that’s greater than 100 indicates a greater confidence, whilst less than 100 indicates decreasing confidence.
A recession in the wider economy is defined when a consumer confidence index falls below 100 for two consecutive quarters. The same parallels can be drawn for the digital industry.
Further analysis
Respondents are anticipating a fall in confidence over the next six months with the index falling from 145.7 to 133.6, a drop of 8.3%.
The highest index score relates to employment opportunities with an index of 152.3, indicating little uncertainty about finding a job in the current market. This would appear to be supported with evidence from Chinwag Jobs, which had over 1,000 vacancies advertised in March 2008.
Despite neutral feelings about salary satisfaction, when respondents were asked whether they were considering moving jobs, the response was overwhelmingly negative.
The second analysis of Digital Pulse in the next quarter of 2008 will give a more detailed indication of how confidence across the industry holds up in the wake of the ‘credit crunch’ and the other wider economic factors.
Sponsor's question
Employer preference for permanent experience over freelance roles 116.8
This indicates that respondents have a slight preference for candidates who have had a larger number of permanent positions over those with freelance experience. This could indicate that freelancers currently benefiting from the dearth of available talent may experience a tougher time finding permanent roles if the market tightens.
This Digital Pulse was sponsored by Gabriele Skelton.
Current market conditions
Nearly three quarters (72%) of the respondents to March’s survey felt either positive or very positive about the current market conditions, and in fact, only 4% felt fairly negative – with no respondents feeling very negative.
The size of the digital team had little or no impact with only those in team sizes of 5-14 showing a slightly more negative view of the market than their counterparts.
Interestingly, those respondents in the top end of their careers (£90k+) were generally more positive than those in junior salary ranges (<£30k), with the middle ranges (£30-60k and £60-90k) having a slightly less positive response than the £90k+ group. (fig 1)
There’s little difference in confidence when segmented by type of employment. Freelance respondents responded with slightly fewer (12%) positive or very positive answers.
Industry sector however, did vary quite substantially (fig 2). Most positive about the industry were those working in advertising/marketing agencies, recruitment companies and web development agencies. The respondents from the client side sector were more ambivalent, with no ‘very positive’ replies.
Future conditions - six months from now
Overall, there was a decrease in the current positive outlook for the digital industry, as well as an increase in both neutral and negative feelings for the industry over the next 6 months. The combined indices for March show an anticipated 21% drop in confidence over this period.
As with their current viewpoints, digital teams between 5-14 people big had a slightly increased negative view, although there wasn’t a notable fluctuation of viewpoints between any of the digital team sizes.
Middle tier earners (£30k-£60 Fig 3) showed the broadest range of responses, which would reflect the largest range of roles falling into this category, as well as the most responses at this salary level.
The type of employment also affects the industry’s viewpoint on what the next 6 months will bring. Only just over half (54%) of the freelance respondents felt positive about the market in 6 months time, as well as 18% feeling negative about it. This contrasts with permanent staff where only 4% felt negative about the market in the next 6 months.
What industry sector respondents belonged to made a difference to their outlook (fig 4). However, the only industry sector with very negative feelings was online publishing. Again, both advertising & marketing agencies, and web development agencies were the most positive in their 6 month outlook.
Employment, Recruitment & Salary
Current views on employment
Three quarters of those taking the survey felt there were ample employment opportunities in the digital industry for them, with half of those feeling this strongly, showing a very buoyant market for job seekers in the industry. Only 8% felt negatively about their employment opportunities.
The majority of those responding (62%) didn’t agree that their salary reflected their true worth, with 9% strongly feeling they were underpaid, almost equalling those at the top end of the scale who strongly felt they were paid what they were worth (10%).
There was a variation on salary satisfaction depending on what sector the respondent fell into (fig 5). The most satisfied of all with their salaries were those working in the advertising and marketing agencies.
Worst off were those working client-side or online publishing, with the highest levels of dissatisfaction and no respondents strongly agreeing their pay was a true reflection of their worth.
Unsurprisingly, those at the bottom end of the market were most likely to feel unhappy with their pay (fig 6). This could be a reflection of poorly paid experienced workers in the digital industry, as well as incorrectly high expectations of worth at the lower end of the digital market.
Current salary levels broke down among survey respondents as follows: less than £30k per annum – 15%; £30-60k – 52%; £60-90k - %23; £90k + - 10%.
In six months time
Over half the respondents (54%) indicated that they wouldn’t be moving roles within the next 6 months. A quarter (25%) of those asked would be considering a move, showing that the jobs market is still very fluid.
Those happiest in their current role worked within the social media sector (fig 7), and those most likely to move were in client side roles. This tallies with their views on the way client side workers see the industry currently and developing. They are also feel the most undervalued of all the sectors.
Surprisingly, despite being the happiest with their wages and future outlook, those working in advertising and marketing agencies had a high instance of respondents thinking of leaving their current roles.
An interesting finding from the March survey was the longer you’ve been working in the digital industry, the more positive you feel about market conditions and employment opportunities. (figs 8 & 9)
This is most likely due to respondents having seen boom and bust cycles previously, and having successfully changed roles more than those new to the industry. The life cycle of the industry is easier to see for those who’ve been in it longer.
Conclusions
This is the first analysis of the Digital Pulse and these results provide an initial benchmark. The monthly Digital Pulse results will be analysed quarterly to provide a distinct picture of trends in confidence, based on the opinions of the people working within the industry.
Confidence in the current market conditions appears to be strong (index of 152), with little, if any negative responses recorded by the respondents. This confidence is also reflected in strong positive attitudes towards employment opportunities and a negative attitude towards moving jobs.
Freelancers are only slightly less confident in the current market, 12% lower than permanent staff, which might indicate a slow shift towards more secure roles.
This buoyant view may be a result of companies looking to digital channels and services for efficiencies in operations and marketing to offset tougher trading conditions. This may bode well for the digital industries in the light of constant media stories of impending economic doom which are afflicting financial institutions, the housing market and possibly the high street.
Based on this set of responses, there is an expectation that confidence will fall over the next six months, with a drop of 8.3% between current and future conditions. The next analysis of the Digital Pulse will cast further light on this topic as the trends in confidence emerge.
Agency land seems to be happy enough with both 77% of web and advertising/marketing agencies giving a positive response to current conditions. A cooling in the market might actually mean that workloads fall to a level which they can cope with, given the difficulty in finding skilled staff.
The media industry is feeling the chill, which isn’t surprising based on past history of advertising budgets bearing the early brunt of any spending cuts, with 36% of respondents working in online publishing feeling negative about current conditions. This may also impact on web and mobile start-ups focusing on advertising as their key source of income.
Methodology
This short survey was designed to gauge confidence feedback from the people that work in the digital industry. The respondents were self-selecting from the audience across Chinwag’s network of websites and links from high-profile industry blogs.
Details about the survey:
- Response were gathered from 1st to 31st March 2008
- Survey responses were collected from 130 people
- All surveys were completed anonymously
About Chinwag
The Chinwag community is a focal point for digital media practitioners in the UK and beyond. Founded in 1996, Chinwag has developed into a community media company that publishes websites, discussion forums, blogs and runs events supporting the people and companies who work in the digital industry.
Chinwag’s online community is focused around its live events, blogs and email forums. The first forum, an email discussion list called uk-netmarketing, is acknowledged as a key destination for industry professionals. Chinwag’s online forums have now grown to cover other topics including design, usability, social media, wireless marketing, legal issues and recruitment, generating more than one million emails every month.
Chinwag publishes Chinwag Jobs, the leading recruitment website for Online Marketing, Digital Media, Web, Design and Technical positions. British Sky Broadcasting, Google, Yahoo, Vodafone, Yell and the majority of recruitment agencies who place staff in the sector use the service.
Chinwag Live is the company’s event series founded to cast light on trends in the digital media and marketing industry covering topics such as social media measurement, web TV, mobile advertising, online PR and many more. These sessions have sold out throughout 2007 and 2008 and gained a strong reputation for debate and knowledge sharing.
Chinwag also runs Viralmonitor, which is used to promote viral marketing campaigns. Featured brands have included Make Poverty History, Visit London, Sky Sports, Swiftcover.com, Cartoon Network, BBC Five Live, Bacardi, GMTV and the RSPCA.
For more information see our about page.
