Reality Check: The Economy


Photo by Nature Explorer

If you turn on your television or glance at a newspaper, you’re bound to come across the words “economic crisis,” “recession,” and/or “impending doom” without much effort. The media loves telling us just how bad things are and how incredibly horrible they’re going to get.

Now that this is a global issue, with markets declining around the world, I’m curious how the economy is affecting you—if it is at all.

This is the first of several periodic polls we’re going to do on this subject, so please take a minute to respond to the poll and leave a note in the comments. We’ll check back in a couple months to see how things have changed.

[poll id=”3″]

About the author

Justin Cone

/ justincone.com
Together with Carlos El Asmar, Justin co-founded Motionographer, F5 and The Motion Awards. He currently lives in Austin, Texas with is wife, son and fluffball of a dog. Before taking on Motionographer full-time, Justin worked in various capacities at Psyop, NBC-Universal, Apple, Adobe and SCAD.

Join Motionographer on Patreon!

For as little as 7 cents a day, join our Patreon community and shape Motionographer's future!

50 Comments

TheDirtSyndicate

im doing better than ever, but thats only because i just went freelance. im currently making 6 times what i was making on staff.
but we’ll see how long it lasts as things get worse… if things go down the shitter, im gonna be a fireman!!

skeletor

I’d be interested to know how many people who voted are staffers, because unless they’ve been laid off they wouldn’t see any real change.

I know in NY several of the big shops have let people go in the last few months, agencies are widening the pitch net, the quality scripts have dwindled and a lot of smaller companies are predicted to close – whether they will or not we’ll see.

Personally as a freelancer the bookings have slowed and I have talked to several freelancers who have experienced the same. I’d be reluctant to say the sky is falling, but it has definitely lowered :-|

Greg

incase you havent seen “Addendum” the 2nd Zeitgeist movie,
hit it up….some very useful information.
http://video.google.com/videoplay?docid=7065205277695921912
ps- really picks up after the 1st 4 minutes-so hang in there…

red dakini

Yes, that’s the most sensible post!! Congratulations! Are you living in fear? This is exactly what feeds the so-called economic crisis..

Marc B.

Huh? So according to you red dakini showcasing the mechanics of the fraudulent federal reserve is what feeds the economic crisis? What a load of bull…
Shouldn’t you rather look at the crooks who are making it worse with the bailout of the private banking mob?

Our founding fathers have warned us of this and now we have the same thing again we fought against in our independence war.

Here we go to being taxed to death again and a looming hyper-inflation if the feds continue like they do.

red dakini

according to yourself. the conclusion came FROM you, who misinterpreted what i wrote. but a little more info for you (misinterpret at will):

Marc B.

So what’s your point with your first reply then? I don’t get it.

I must assume you agree with me the solution isn’t to live in denial and ignorance just to live in a illusive bubble of happiness.

red dakini

i think there’s a difference between living in denial and knowing what lies behind the facts. i’m not a happier person for knowing certain things, but i’m certainly NOT afraid of the consequences of this ‘economic crisis’.. and now, especially, the old cliche which says “ignorance is a bliss” proves to be exact opposite..

Reset

Working both on a print-based organization and freelancing on the motion design side, there has definitely been a slowdown on jobs. Companies are wary of next year, want to keep things in-house or just canceling projects. Small production houses are suffering.

monovich

I think it is all about budget cycles. People are spending this years budgets to a large degree, so there is a bit of a pad. Where the real results will be seen is during the next budget cycle. Projects are definitely being pulled, but as a freelancer I’ve managed to stay busy. I think being diversified in your client base is a good idea at the moment. I wouldn’t want to be heavily weighted in auto industry work at the moment.

Marc B.

“The media loves telling us just how bad things are and how incredibly horrible they’re going to get.”

And would you rather prefer if they told you things were just fine?

MHR

I’m not saying we’re not in a recession here, but ask any economist and they’ll tell you that market swings are partially psychological. In addition, the news media always plays up fear and extremism to gain audience share, thus the comment.

The credit crisis is real, and effects everyone, but unless this thing delves into a real depression, 99% of Americans have more money and “things” than we probably need, so I’ll venture to say that we’ll be OK for quite awhile.

justin

This helps make the point:
http://www.tlex.com/wordpress/?p=22

“The media and marketing worlds love nothing more than a shorthand phrase that will trigger a predictable neurological response (see “Osama’s Fathers Day Gift“) below. And, in these troubled times, that phrase is “in these troubled times”.

..I’ll be tracking, through Google, the number of hits that a search for the phrase ”in these troubled times” yields. We’ll see how this correlates with the real economic situation. So, check in often and we’ll see how this goes.

Results:
November, 13, 2008: 159,000 hits. Dow at about 8,300.”

Pete

A statistic like ‘99%’ immediately means that you’re being flippant, but I don’t think that an iPhone-toting, advertiser-enabling designer is in a position to make an offhanded comment about 99% of people being materialists with too many ‘things’ who’ll be just ‘fine’. People are losing their jobs & houses, I don’t think that they’re ‘OK’.

Heard a line on a podcast the other day that seems appropriate – “A recession is when someone else loses their job, a depression is when I lose my job”.

MHR

You’re right, my comments could come off as flippant, but they weren’t meant to. I’m not sure this is the right place to get into a philosophical debate, but we obviously live in a capitalist system where buying/spending is strongly encouraged. When you spend, you have debt. When you have debt, you don’t have savings. When you don’t have savings, you lose your house and your iPhone plan at the slightest economic downturn. Why do you think the Great Depression generation is still so tight with their money/possessions?

Again, it’s horrible that some people are already losing their jobs and houses, and I’m in the same position everyone else is (although I don’t own an iPhone – sorry to disappoint you man). But if you take a broader perspective, we’re still the richest country on earth, and I think it’s common knowledge now about how much of a joy ride we’ve all been on. The financial mentality of some has to be questioned, don’t you think?

People will lose their houses and jobs, but put it in context – I’ll venture to say that they still might be better off than some in other parts of the world. In addition, the govt is already trying to help allay these personal crises, and honestly, do you fear that the country will hit bottom and never come out of it? Eventually the economy will come back – its cyclical.

Check out this article:
http://www.citykin.com/2008/11/peter-schiff-was-right.html

ragecg

Laid off last week after 5 yrs… just before christmas too:(

of course, the Midwest effects and animation industry isn’t as booming as some would make it seem.

justin

Shit, I’m sorry to hear that. Hope you find something new soon.

briangossett

I have been fortunate working more direct to agencies and helping out my friends at motion shops here and there so biz is good as usual. I do know it’s slowed down just a bit in LA though but I think everyone will power through this recession and come out ok. At least I hope they do because I like the people I work with.

martz

yo im in the woods right now, these bears just rolled up and starting eating my laptop, i had to fight them off with skills i learned from playing world of warcraft and watching man vs. wild re-runs on hulu.

but, for serious though,

freelance is pretty slow here in southeast (shout out @ragecg, i feel you on the whole livinginplacesthatarentcallednewyorkorlosangeles thing, hope you get a job soon!)

but on the bright side i’ve never really pegged myself as much of a worker bee, life is too short to be on the computer 24/7…..

oh….

fuck….

signing off.

Fabricio Lima

Even professions in World of Warcraft are complicated now….
50 gold for all the tailoring patterns?! wtf.. :)

But yeah, here in Europe things are going slow too..
Its a bit extra-concerning for me since I am a immigrant, so things goes sour, and in a heart bit i might be in a plane heading back to Brazil :(

Aaron

Yeah I’m feeling things slowing down in Chicago as well, but I’ve managed to keep at my steady pace and haven’t felt the effects personally. I feel more lucky than anything right now and am certainly hoping things get better soon. This article scared the shit out of me:

“Where the NFL makes its money is on selling their TV rights. One of the jewels of those broadcasting deals is rights to the Super Bowl. NBC is charging $3 million for a 30-second spot. The network was able to sell most of their time over the summer, before the economic meltdown on Wall Street.

But the network has eight ad slots left and hasn’t been able to sell them for the last two months. Several big-time advertisers are out of the picture. General Motors won’t have any Super Bowl ads. FedEx has not bought ad time, even though they’ve been part of the game broadcast for the last dozen years. Garmin is sitting out this year’s Super Bowl.

Some advertisers do not have the cash. Others don’t want to send a message with spending so much money on a single advertising event.

“With this much money on the line it can be a negative reflection on a company, especially if they are cutting back staff or getting a government bailout,” said Steve Lanzano, COO of MPG North America, a media buying company in an interview with the Wall Street Journal.

Somehow you can bet that NBC will find a way to sell those ads, no matter the price.”
http://www.bobgretz.com

StbN

I can´t belive the partial results. I hope it change in two months when you get the final result. To me is not easy to get a job, even working as freelance. And I’m sorry but it could be because I’m from Southamerica where things are really bad, most of the poeple here looks like to be in The Cream O’ the Crop.. lol

gabriel.rocha

Well, not much difference for me, i’m a freelancer and i have been prety busy for the last months. I’m working on one job right now an will last ’til the end of this month. I have to admit, the phone is not ringing as usual, my mailbox doesn’t get many mails asking availability, but i still have work to do (what is good). So i can’t complain much, but i hope things get better again for everyone. but i also work for studios and people from all over the world, so maybe this is kind of a good thing for freelancers, right? Since we deal with different economic situations for different countries (even if its a global issue). Well i just wish the best for all.

justin

It definitely seems that freelancers have a bit of an edge right now. Not having to pay benefits and taxes on an employee is a huge incentive for companies to hire freelancers instead of staffers. Freelancers are also hired on an as-needed basis, so (in theory, at least) companies can save money there, too.

I’m curious, though: Has anyone had to lower their day-rates? Are employers balking at your usual rates?

gabriel.rocha

No, Not yet… let’s see how long will it last…

Marc B.

I find this poll very interesting but we should come back in a couple of months or in a half year again and see how things are then. Because now the recession or depression just started or is about to start.

justin

“This is the first of several periodic polls we’re going to do on this subject, so please take a minute to respond to the poll and leave a note in the comments. We’ll check back in a couple months to see how things have changed.”

two.oh

I’m more worried about 2009. We can expect a larger amount of layoffs and cutbacks than in 2008. The US is currently at 6.5% for unemployment, and it’s only going to increase.

These companies have started cutting back on their advertising budgets, so we’ll start feeling more tension in the months to come.

yonibendor

it seems like everyone’s talking about budgets being cut down and freelancers being hired on “as-needed” basis…
so, if budgets are lower than ever right now it would only make sense that agencies would try to contact directly the all arounder freelancers who can design/3d/animate rather than contact the studio/company who would just be the middle man.
therefore the agencies could cut down expenses while hiring these freelancers directly.
just a thought..

justin

Cool thought in theory, but most agencies have their heads up their asses when it comes to motion design. And they’re not really set up to manage production. The writers, producers and art directors at agencies have their hands full landing clients and new jobs—they don’t have the resources to handle full-on production of motion work.

So they’d have to ramp up in that area, adding more people and essentially creating an internal studio. And that costs a ton of money, which defeats the initial purpose.

Having said that, some agencies are building in-house production arms. Whether this will work remains to be seen. I think a better idea is for studios to take on larger roles. Agencies are appearing less and less relevant—and less and less cost-effective. Their real value seems to be mostly in sales, account management and media buying.

That’s my limited take on things, at least…

gabriel.rocha

Well said. I heard about agencies with production arms, but as far as i know they just can’t take much work, i think they mostly use for smaller stuff and internal jobs. Would be great if studios could keep taking the jobs without the middle man, but sometimes it’s kind of a mess if you don’t have good people to deal with the client, the job can become a huge nightmare. Anyways, sometimes it happens when you have the agencies too… so what was my point again?

jasonk

it’s very easy to decry the role that agencies play in the relationship between a brand and their customers, but – in theory, bear with me here – i think they’re more important than they have ever been.

i’ve seen my own clients walk away from the agencies i’ve worked at in the past, on the grounds that they perceive the real person doing the work to be the ‘producer’ – not in job title, but in function. that is, if psyop or the barbarians can create great work and that’s what you’re paying for, then why not go to them directly, cut out the 30 people working on the account at the agency, and just get what you wanted in the first place?

would that it were that simple. while clients may invariably think they know what they want, in reality it’s a different picture – and that’s where an agency comes in. somebody needs to shepherd the brand through the whims of consumer and client alike, objectively, and still (with a few exceptions) the only structure to do so is found at advertising agencies.

that’s not to say that they have nothing to learn or there are no changes to be made; agencies large and small are facing huge challenges to prove their relevance and maintain their ability to deliver results. but, anecdotally, i can’t tell you how much work i’ve seen done that bypasses an agency structure and goes direct to the ‘producer’ that falls far short of the mark because it is off target, off brand, off whatever.

in summary,

– agencies: GROW A PAIR. that is the only value you provide. stick to your guns and earn out that awesome salary.
– production companies: HI THERE. keep up the good work. if you end up doing work direct with a client, refer back to their existing body of work every five minutes to do a reality check and see if you feel like you’re on brand. and remember: managing the client will cost you more than you thought it would.

Chinaski

So far things in LA seem about normal (at least for me). I don’t think we’ll really know the effects of the economic situation until January, when new budgets are set for the year.

Anthony Esquivel

Im doing better than ever, only because I am living on school loans, and found someone to fund my first project when I get out of school.

Æ

Gmo

I’ve just gotten out of school and can’t find a job anywhere.

Marc B.

Have you considered FedEx Kinkos or McDonalds?

Remember kid no job is bad in bad times!

mate

I’m just reading “where the suckers moon”, a very entertaining and intriguing book about the advertising industry. Some numbers from page 228:

1970s
most expansive production cost ~ $70,000

1980s
’88 ~12% up, ’89 another ~8% up
agency markup ~ 17%
production company markup ~ 35%
commercial director fee per day up to $25,000

1991
average production cost, single national TV Ad ~ $168,000
average production cost, car commercial ~ $235,000

Today the average budget for a :30 second commercial is supposedly around $300.000.

yonibendor

these numbers are also relevant to a pack of smoke, coca cola, and just about everything.

They were all cheaper at the 70’s if you compare digits yet, the value the dollar had was different as well.

Marc B.

Ever heard of “inflation”?

yonibendor

that was exactly my point, but thanks for pointing that out in a professional term.

gabriel.rocha

Interesting information… will look for this book.
Maybe 2009 numbers are going back to the 90’s?
Nah.. just kidding!

yonibendor

that was exactly my point, but thanks for using the professional term.

gugy

I am a veteran designer. Working for more than 14 years on the industry. The situation seems to be somewhat normal, But the last 8 years I felt a gradual decline in terms of rates form what use to be in the 90’s. Now most companies expect designers to be animators and sometimes even producers or vice-versa.
There are way more young people in the market place and the wages got much lower than used to be. I guess just a natural phenomenon of our industry becoming mainstream.
Long gone are the days that I would sit for more than a month on an Inferno bay in Santa Monica and have multiple cappuccinos. :-) The broadcast packages were at least 3 months long and we had budget for at least $500k and live action was always an option.

2009 I think is going to be hard, but I hope the future will be better after that. Let’s hope so.

Marc B.

If it walks like a duck and if it talks like a duck it probably is a recession.

More bad news pouring down on us

http://money.cnn.com/2008/11/16/news/international/japan_recession/index.htm?postversion=2008111620

eckythump

this is my 3rd recession. and i know 2009 is going to be brutal everyone.

so cancel the cable… stop eating out every night… get busy with bittorrent… do you really need the new iphone/52″ flatscreen/bmw?… spread your savings between banks… and get a bicycle.

this is an economic global meltdown, and it will hit you, wherever you are.

briangossett

I keep all of my cash under my mattress.

erock

Things are pretty bad here in NYC. I have 6 years of solid experience working in NYC as a Broadcast Designer/Motion Graphics Designer, and I was laid off from my staff job this past April due to lack of work. It has been 7 months now and I have yet to find a new full-time job.

Any place that is claiming to hire full-time wants to pay you pennies. I am forced to lower my day rate and hourly rate just to get freelance work, and even that I can barely get. I’ve had two freelance gigs in the last 7 months. Both of which lasted two weeks, went over budget, and got scrapped. Last year, I had freelanced at a bunch of different networks and post houses. I reached out to all of them and not one place has any work for me.

I also have a few friends who are staff Interactive Designers, their jobs rely heavily on ad sales and even that is in the shits, work is so slow for them right now that they are all worried they will lose their jobs any day now.

I feel really sorry for all the talented kids coming of school looking to get into this industry. They are the ones who will be struggling the most. I mean….just do a local job search in NYC and see how many Motion jobs pop up.

Joe Clay

Earlier in the year I was laid off, and then, before I even had my current reel put together, I got a call. I went in, initially refused the job, and I sent a letter to the owner thanking him for getting in touch with me and having me in, and that, though I thought very well of him, the job wasn’t right for me. He convinced me to come in and try it out. I decided that it was fine for me, and I’m pretty much making 150% of my old salary and I’m not afraid to tell my boss hello, and I know he’ll say it back to me. My old boss wasn’t very nice to anyone, unless we were at the bar.

Beaver

I agree with Gugy about 2009. We’re still riding the 2008 advertising budget right now, which is going to get slashed. If you post this poll again in 6 months, I think that would make for an interesting comparison.

I’ve been busy as ever, but on the other hand, I know a lot of people that have been layed off. Even though there are some real problems, I agree that in a lot of ways, all the bad news is self-fulilling. I’m in Atlanta where we recently had a major gas shortage because…duh…there was news about a gas shortage, and everyone got whipped up into a gas-buying frenzy.

I think the bad economic news is doing the same thing to businesses. People are getting layed off in preparation for slower times, but then the layoffs become the source of the problem.

Comments are closed.