Gannett will cut 10 percent of newspaper jobs
NEW YORK |
NEW YORK (Reuters) - Gannett Co Inc, the largest U.S. newspaper publisher, is planning to cut about 10 percent of jobs at its local papers as it fights advertising declines made worse by the global financial crisis.
It is the second round of layoffs that Gannett has planned in the past two months. In August, Gannett said it would eliminate 1,000 newspaper jobs, with 600 being laid off.
The latest round will be all layoffs, according to a memo sent to staff by Newspaper Division President Robert Dickey on Tuesday.
"As all of you are painfully aware, the fiscal crisis is deepening and the economy is getting worse. Gannett's revenues continue to be severely impacted by this downturn, and our local operations are suffering," Dickey wrote to employees.
"While this is more bad news, it is a sign of Gannett's determination to remain healthy and viable as a company during these turbulent economic times," he said.
Gannett does not release employee headcount numbers. Based on the previous 1,000 cuts, which totaled 3 percent of staff, the division would have more than 32,000 employees. Ten percent of that would be about 3,200 positions.
Calculating the exact number of people who will be cut in this latest round is hard, however. The division's headcount includes hundreds of workers at USA Today who will not be affected, spokeswoman Tara Connell said.
Instead, it will be employees at the more than 80 local daily papers Gannett publishes and owns from coast to coast, including The Arizona Republic in Phoenix; the Tallahassee Democrat in Florida; the Argus Leader in Sioux Falls, South Dakota; and The Journal News in Westchester County, New York.
Publishers also have discretion to find ways to cut their payroll by 10 percent, which may not involve cutting an immediate 10 percent of those employees, Connell said. The publisher's plans are due by November 14.
A Gannett watchdog blog published by a former company reporter, Jim Hopkins, put the number of jobs to go at 3,000, but Connell said the amount of people actually leaving likely would turn out lower.
The McLean, Virginia-based company warned last week that more cuts could come. Gannett on Friday reported lower-than-expected profit and said advertising revenue at its publishing division fell 18 percent during the third quarter.
So far, Gannett and other newspaper publishers that have reported financial results in the past two weeks have said that the advertising climate does not look good in the near future.
Gannett's board plans to meet this Thursday, when it may decide to cut its dividend. Several publishers have done this to free up more money to pay sometimes staggering amounts of debt. Ratings agencies have been downgrading the debt that many publishers carry as they bring in less cash to pay it off.
Gannett shares rose 58 cents, or 6.4 percent, to $9.70 on the New York Stock Exchange in afternoon trading. Its stock has lost more than 75 percent of its value in the past 12 months.
(Editing by Bernard Orr)
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