“The Associate Problem”: A thesis we coined in May this year, as firms continue to replace junior staff with AI, cutting costs for PR headlines to improve stock prices. It goes without saying that big tech loves to follow a trend, and this is the current misplaced party line.
If there’s any industry I know best, it’s media. The agency, the publisher, the studio. There, interns, junior designers and art directors all worked long hours in frustrating conditions. “Change this kerning”, “The client needs an extra page on this deck”, “Change the kerning back”. It was thankless, but it mattered. Within all this grunt work was a key factor: you were learning the craft. You started to understand strategy, you got to see the best in your industry work and be part of the process, and you were gaining the experience to see how it should—or shouldn’t—be done.
In Q2 this year, the IPA ran an agency census, and while the statistics aren’t surprising, they are concerning.
30% of creative and non-media agencies say they will be reducing their work force due to AI in the next 12 months. 57% of agencies now don’t employ graduate or apprentice candidates at all.
It simply raises the question: where does the next senior creative director or VP of strategy come from when there’s no way for a junior to learn the craft?
There’s an argument that junior staff can be checking AI’s output, mistakes and inaccuracies. But there are two main problems with this. The first is that critical thinking is necessary, a trait that is fast fading as AI becomes more prevalent, and the second is the assumption that AI doesn’t rapidly increase its capabilities to the point where it doesn’t need checking in the first place. Both of these lead to the same future: no training ground for the ones starting out in the industry.
We’re going to see a loss of culture at firms, because the people coming through will no longer have spent years absorbing how that culture actually works.
Our whole thesis here at Moatt is that culture, taste and discernment in the AI era are all that matter. They’re the differentiators that future share prices will be based upon. Initially, cutting costs will look like the smartest-in-the-room decision. After all, everyone else is doing it—until two years down the line and there’s not a senior decision-maker in sight.
Invest in taste. Invest in those who are plugged into the new generation’s culture. They will be your most important asset.
