The Agency Model Is Collapsing. AI Is Picking Up the Pieces.
The one thing you need to know in AI today | AI-Ready CMO
The UK ad industry just recorded its worst year for talent loss since records began.
The IPA’s 2025 Agency Census is out, and the picture is really grim. Creative agency employment fell 14.3% in a single year, and almost 60% of people who left actually resigned. They saw the trajectory and walked before they were pushed.
The junior workforce is being gutted. Under-25 headcount shrank by nearly a fifth, and only 43% of agencies even bothered hiring entry-level staff last year, down from 56%. Advertised jobs across the industry fell 41%. The talent pipeline is collapsing.
We saw the same pattern in the US data a few months ago. Junior and mid-level execution roles vanishing while senior and strategic roles hold or grow.
And the cuts are accelerating. 24% of agencies now expect to reduce roles directly because of AI this year—triple the number that actually did in 2025.
WPP fell out of the FTSE 100 for the first time in three decades and is folding Ogilvy, VML, and AKQA into a single entity called WPP Creative. Three legendary agencies, one roof, fewer people.
That word keeps coming up: fewer.
While every agency is trying to figure out how to thrive (or at least survive) in the age of AI, it is already clear what does not work. Agency founder James Kirkham nailed it: treating AI as “an efficiency play—shave a few numbers, strip some cost” is “death by a thousand cuts with a spreadsheet.” Agencies cutting headcount to maintain the same output at lower cost are optimizing themselves into irrelevance.
The agencies that will still exist in five years are already doing different work. Real-time creative optimization across dozens of markets. Brand systems that learn and adapt instead of static guidelines in a PDF. Proprietary tools built for clients instead of hours billed to them. Production is a commodity now. Architecture and taste are where the value lives. (This was the topic of our first AI-Ready CMO podcast, which you can watch here.)
And if you’re sitting inside one of these agencies, don’t wait for leadership to work this out.
Learn the tools. Build workflows. Every role that disappeared last year competed with automation on speed and cost, and that’s a losing game. If you want to thrive in this industry, you need to be the one building the systems. Start now.
— Torsten and Peter
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Our January AI in Marketing Report is out.
AI isn't slowing down in 2026. This report gives you the strategic context you need to stay ahead.
January brought major model releases, new enterprise adoption patterns, and shifts in how marketing teams actually use AI. We’ve uncoverd the pattern analysis across 31 days of developments. What’s accelerating. What’s overhyped. What you should be testing now.
The report includes implementation frameworks, budget guidance, and forward indicators for Q1. Built for leaders who need to make decisions, not just stay informed.
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