Washington Post, New York Times seek new cost cuts
NEW YORK (Reuters) - Two of the most respected U.S. newspaper publishers, The Washington Post Co and The New York Times Co, are embarking on new cost cuts in the face of dramatic declines in advertising revenue.
The Times said it laid off 100 workers and is cutting non-union salaries. It is also asking unionized employees to accept similar concessions to avoid layoffs in the newsroom.
The Post is offering a new round of buyouts to newsroom, production and circulation employees, and said it could not rule out laying off staff.
"This was a very difficult decision to make," said a memo signed by Times Chairman Arthur Sulzberger Jr. and Chief Executive Janet Robinson. "The environment we are in is the toughest we have seen in our years in business."
The moves come as a host of other U.S. newspaper publishers have reduced staff, declared bankruptcy or shuttered once-vaunted newspapers, as readers seek news online and elsewhere and as the recession crimps advertising spending.
Non-union employees at the New York Times and the Boston Globe would get a 5 percent pay cut for nine months, along with 10 days off. At other units, including the company's Worcester, Massachusetts, newspaper, the amounts would be a 2.5 percent pay cut and five days off.
The Times has laid off workers before, including 500 at a newspaper and magazine distribution unit that it closed. It also held buyouts in its newsroom last year and laid off a small number of employees there.
Neither the Post nor the Times has laid off thousands of workers like some other U.S. publishers, such as Gannett Co Inc and McClatchy Co in recent years. Both the Times and Post have some of the largest U.S. newsrooms.
The Post has offered buyouts on several occasions in the past few years. A round in May reduced the newsroom staff by at least 10 percent, when more than 100 journalists left. The company recorded an $87.4 million charge for that round, as well as ones offered to Newsweek magazine employees.
The Post employs about 700 news staffers at its D.C. headquarters and about 100 at its digital operation. The company is not offering the buyouts to Website employees.
The Times has 9,346 full-time employees and 4,076 at the New York Times Media Group, which includes the paper and its digital operations. The Times newsroom has about 1,300 people.
The Times told the Newspaper Guild of New York that its acceptance of the salary cut would save the company about $4.5 million. The guild said it is considering the proposal.
NO GUARANTEES ABOUT LAYOFFS
The first wave of Post workers taking the buyouts would leave in July, Publisher Katharine Weymouth told Reuters in an interview. She would not say how many buyouts the paper wants.
"While online revenues have been growing, they have not yet grown fast enough to offset the declines we are seeing in print revenues," Weymouth wrote to employees.
"While we expect to be able to achieve meaningful staff reductions ... I am sorry to say that we cannot rule out layoffs in the future," she wrote.
The news comes a day after the company's chairman and chief executive, Donald Graham, Weymouth's uncle, told shareholders in a letter that the Post and Newsweek magazine lost money in 2008 and that the Post will lose money in 2009.
Weymouth said she has submitted a plan to Graham, Post management and the board, which includes Berkshire Hathaway Inc chief Warren Buffett, to make the paper profitable.
She declined to offer specifics or timing, but said that it is "partly about cutting costs to a sustainable level and making sure you're investing in platforms for the future."
The Post will not venture down the path of other papers that are eliminating their print editions on days of the week that traditionally bring in fewer ads, she said.
Many U.S. papers have lost 20 percent or more of their ad revenue as more people get news online for free. Some are furloughing employees; others are trudging through bankruptcy.
EW Scripps Co closed the Rocky Mountain News in February. Hearst Corp shut down the print edition of the Seattle Post-Intelligencer, may close the San Francisco Chronicle and is cutting 12 percent of the staff at the Houston Chronicle. The Atlanta Journal-Constitution is cutting a third of its full-time newsroom staff.
Post shares rose $6.93 to close at $384.28 on the New York Stock Exchange afternoon trading. Times shares rose 41 cents to close at $4.98.
(Reporting by Robert MacMillan, editing by Gerald E. McCormick and Derek Caney)
- Exclusive: Angry with Washington, 1 in 4 Americans open to secession
- Secret Service investigates after man jumps White House fence, reaches doors
- French jets strike in Iraq, expanding U.S.-led campaign against Islamic State |
- Scots spurn independence in historic vote, devolution battle begins |
- Thousands of Syrian Kurds flee to Turkey as Islamic State advances |