November 19, 2009 / 10:24 PM / 10 years ago

UPDATE 1-BusinessWeek lays off up to 130 workers, AP cuts 90

(Adds details on AP size, Bloomberg cuts)

By Robert MacMillan

NEW YORK, Nov 19 (Reuters) - BusinessWeek will lay off up to 130 workers, about a third of its staff as Bloomberg LP prepares to take over the magazine from McGraw-Hill Companies Inc MHP.N, two sources at the magazine said on Thursday.

News of the job cuts comes on the same day The Associated Press said it is laying off 90 news department workers, or about 3 percent of its worldwide news staff, and capped a grim week for journalists whose jobs at many U.S. news outlets have been drying up in recent years.

Bloomberg and McGraw executives told many BusinessWeek workers on Thursday and earlier this week that they would lose their jobs once Bloomberg buys the magazine.

Employees there are getting a severance package that includes two weeks of pay for every year they worked at the magazine, said a third source at the magazine who insisted on anonymity to avoid violating a nondisclosure agreement that McGraw attached to the severance package.

Workers there this week got telephone calls telling them to go to meeting rooms for individual appointments. If Bloomberg staffers greeted them, they kept their jobs, the source said. McGraw staffers in the room meant that they are being fired, the source said.

A Bloomberg spokeswoman said the 130 number was inaccurate, but declined to comment further. A McGraw-Hill spokesman was not immediately available for comment.

Many workers at the magazine, as well as media experts, expected Bloomberg to cut jobs before taking over. Bloomberg executives said in interviews with Reuters and other media outlets last month that their goal was to not gut BusinessWeek.

All day long on Thursday, BusinessWeek staffers reported on Twitter that they had lost their jobs. Many were columnists and writers with decades of service at the magazine and names well known to business news readers.

Among them are media reporter Jon Fine, technology columnist Steve Wildstrom and senior correspondent Rob Hof.

“I don’t quite believe it myself, but I’m leaving BusinessWeek after 21+ years,” Hof wrote on his Twitter feed.

Other workers in BusinessWeek’s video and Web editorial departments learned they would lose their jobs too, the sources told Reuters.

Bloomberg is buying BusinessWeek for between $2 million and $5 million, the magazine has reported. The news and financial information provider wants to expand its reach into mainstream news and beyond its financial computer terminal clients.

The privately held company competes with Thomson Reuters Corp (TRI.TO)(TRI.N) in providing news and data.

The AP, meanwhile, has been trying to retain its newspaper members who help pay for the nonprofit news cooperative. Many of its clients have been coping with severe advertising declines and also have been laying off workers.

A year ago, the AP said it wanted to reduce global payroll costs by 10 percent in 2009 and that the 90 layoffs helped it reach that goal.

The AP also has frozen hiring and bought out about 100 employees earlier this year.

The organization had 4,000 employees at the beginning of the year. About three-quarters of them are in its journalism operations, a spokesman said. (Reporting by Robert MacMillan; editing by Andre Grenon)

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