The Gulf Time Newspaper One of the finest business newspapers in the UAE brought to you by our professional writers and editors.
Tribune news service
Bahrain’s Public Relations (PR) sector is under threat from an economic slowdown caused by low oil prices, according to an expert. The government has launched an austerity drive to tackle rising public debt and reduce the national deficit, but lower public spending also means less investment in the private sector.
US presidential advisor Mary Jo Jacobi warned that the PR industry could be susceptible to private sector belt-tightening as a result. “Usually public relations companies are indirectly affected by financial problems because they are suppliers of a service to companies that are directly affected,†said Ms Jacobi, former vice-president for communications at BP America, Royal Dutch Shell, HSBC and Lehman Brothers.
“So when the downturn occurs, the stock market changes, the share prices go down and income goes down. “Public relations becomes one of the first things that big companies stop doing when things get bad, but of course logic says that this is the time when they should be doing this the most.
“So it trickles down through the economy, from the first affected to service providers – which receive the hit later, but it is often more impactful because they are smaller and dependent on their clients.†The oil price is currently around $50 for Brent crude, but the GDN had reported that it must reach $138 per barrel for Bahrain’s economy to break even. Avoiding excess employment and using smart hiring formulas to employ the right number of people for the amount of work is key to coping during a dry spell, Ms Jacobi told the GDN on the sidelines of the third Global PR Summit at the Ritz-Carlton Bahrain.
“The challenge for public relations companies is to plan ahead,†she said. “Financial crises occur every 10 years or so to varying degrees or problems, but I think it is always easy for a company and the first thing it does is lay off staff because you can get a lot of savings back.
“The key is to think about what the company wants to be and how to manage the company to achieve that and to have the right number of staff for that work, so you won’t lay off staff when bad times come.
“Unfortunately, the last financial crisis affected the whole world very long, very deep, very bad and most of us were not ready for it.†The Global PR Summit ends today and covers latest trends and challenges in the regional communications world, including crisis communications, reputation management, visual PR and digital PR.