Corporate PR Budgets Are Solid, Despite Economic Uncertainty

According to the USC-Annenberg Study of PR departments, PR departments on average saw their budgets increase by 7% in 2007, and they expected their budgets to increase by 5% in 2008. The survey was taken in the second half of last year, when there was much less talk of recession and the subprime mortgage crisis had yet to really destabilize the economy. So it’s possible that budgets are being trimmed during the year as the economy weakens, but as of the beginning of the year, PR budgets remained strong.

Other budgetary findings from survey:

• The near universal growth in average staff size (from 40 to 60 among the largest companies) suggests that the stabilization noted in the 2005 survey has led to a period of notable growth across all categories of organizations participating in the survey.

• There were statistical correlations revealing that those organizations with larger PR budgets were significantly more likely to report to the C-Suite, to be invited into organizational strategic planning, to work with more than one PR agency, and to coordinate and integrate the various communications functions.

• The fact that organizations with larger PR budgets are much more likely to indicate that the communications function is well-integrated with other departments is noteworthy, in that these would tend to be the very organizations with the most complex structures. If the largest, most complex organizations see the benefits of breaking down silos and are able to do so, then certainly smaller organizations can (and should) follow suit.

• Respondents from organizations with $3.1 billion or higher revenues were significantly more likely to describe their organizations as being ethical and proactive. It suggests a connection between greater expenditure on communication relative to organizational size on the one hand, and a greater commitment to transparency, ethical business practices, and a forward-looking perspective on the other.