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Chicago Advertising Jobs Cut with Burnett

Posted on May 4, 2009

At least two large companies are cutting advertising costs, which will result in the loss of hundreds of Chicago advertising jobs.

Philip Morris, one of the country’s leading tobacco companies, recently announced that it plans to cut back on advertising. The company said it plans to scale back on spending for all brands except Marlboro, including Basic, Parliament and Virginia Slims.

According to an article by the Chicago Sun-Times, this could mean the loss of at least 300 advertising jobs. At ad agency Leo Burnett, between 400 and 500 people in Chicago and overseas work in part on Philip Morris advertising, making it one of the company’s biggest accounts. The company has not yet said exactly how many jobs in Chicago will be affected.

General Motors Corporation also recently cut its advertising costs, which led to 75 layoffs at Burnett. The ad agency also fired Chief Creative Officer John Condon and has yet to name a successor.

Earlier this year, Burnett suffered a major setback as a scandal involving the U.S. Army was unveiled, although that client left the company several years before. The U.S. Government filed suit alleging over0billing on the Army account, but Burnett settled on paying $15 million without admitting wrongdoing.

The advertising job cuts could lead to a higher unemployment rate for Chicago. During March, the Chicago-Naperville-Joliet area saw its unemployment rate increase from 9 percent to 9.3 percent, higher than the national unemployment rate of 8.5 percent.

The area had a total non-farm employment of 3,673,900 workers during March, according to the United States Department of Labor Bureau of Labor Statistics. This is down from 3,674,600 workers during February and a 3.7 percent decrease from last year.