J. Walter Thompson Fires 35 in L.A.

In the bleakest of beginnings to the holiday season, the Los Angeles office of the ad agency J. Walter Thompson on Monday handed walking papers to about 35 employees--about one-third of its staff.

The layoffs, which follow the agency’s decision last week to drop the estimated $50-million Bally’s Health & Tennis Corp. media-buying business, will take effect Jan. 1.

The layoffs are across the board, from secretaries to senior vice presidents.

“This is no time for pep rallies,” said William M. Lane, executive vice president of the agency, whose largest clients include Vons supermarkets and Mexicana Airlines. “This is a very tough day. We’re seriously sorry for the people who have to leave us. And we’re seriously committed to the people who will remain.”

Although hundreds of Los Angeles advertising agency employees have lost their jobs during the year-old industry recession, few offices have felt the effects as much as JWT. Two years ago, the agency had up to 200 employees in Los Angeles. Today, it employs about 80.

“As a responsible business, we had to make the layoffs,” said Lane, whose agency dropped the health club chain--which operates locally as Holiday Spa--because financially ailing Bally’s refused to revise its payment schedule. Earlier this year, the agency lost the estimated $29-million 20th Century Fox account, which also resulted in substantial layoffs.

Lane, who has been the top executive at JWT Los Angeles for about six months, said he determined how many employees would be let go. “I bit the bullet and did it,” Lane said. “I’ll let people editorialize. I suspect I could come out of this looking like the bad guy.”

Because of the holiday season, however, Lane said, the layoffs were deferred until Jan. 1.

Advertising industry executives say it will not be easy for JWT to bounce back. “This would be a devastating blow to any agency,” said Stephen Hayman, general manager of the Los Angeles office of Foote, Cone & Belding Communications. “The big issue is morale. They will have to work on building confidence that can bring the office back.”