Gannett Co. Inc. has cut 50 positions at the Courier-Journal, 10 percent of its workforce, with the Neighborhoods and Velocity sections hardest hit.
A story by Chris Otts reported 24 people were laid off from the newspaper’s news room including half the staff of the Neighborhoods zoned weekly news.
Those cut include long-time CJ staffers Betty Winston Baye, Sheryl Edelen, Tamara Ikenberg and Tom Nord, according to sources, and double-verified by insiders.
In internal memos, Gannett executives blamed lagging advertising revenue for print amid continued economic woes for the massive cuts, about 700 people nationwide. (See the memos below.)
Gannett Blog, an independent blog by former Courier-Journal reporter Jim Hopkins, broke the story early yesterday.
The independent Indianapolis Business Journal reported 62 employees laid off at the Indianapolis Star including 12 copy editors and eight reporters.
Arnold Garson, Courier-Journal publisher, sent this memo to employees about noon yesterday:
The attached letter is from Bob Dickey, president of Gannett’s U.S. Community Publishing division. It announces a company-wide job elimination program, which will occur today, and, which, unfortunately, will include Louisville. We do recognize how difficult this is for our employees. But the simple reality is that the economy has not rebounded as rapidly as we had hoped. We are doing everything possible to generate revenue and we are having some successes, including circulation sales, a recent sales rally initiative and some very nice local advertising contract sales. But overall, many advertisers continue to cut back and and several key segments of the economy remain troubled. In Louisville, job creation, perhaps the most important key to economic recovery, has lagged what is going on in many comparable cities. Our revenue is not meeting expectations. Given this unfortunate set of circumstances, payroll reduction is the only option we have to keep expenses in line with revenue.
We plan to notify affected employees today and will let all employees know when the process is completed.
In a follow-up story in his paper, Garson said the CJ’s future “depends on the local economy, which hasn’t rebounded as fully as hoped. If we get a break, we’ll be fine.”
Gannett Blog reports about three percent of Gannett’s total United States workforce was let go, the largest round of cuts since 2009 when the company cut about 3,000 people.
It’s the fourth company-wide layoff since August, 2008. Gannett has about 22,000 employees at its 82 domestic newspaper operations.
Cuts vary across the chain, according to posts on Gannett Blog. The Wall Street Journal is reporting Gannett identified cost targets and left cuts up to individual publishers.
This memo was sent yesterday from Gannett headquarter in McClean, Va.
CONFIDENTIAL
CONTAINS PROPRIETARY BUSINESS INFORMATION – NOT FOR PUBLIC DISSEMINATION
June 21, 2011
To: All US Community Publishing employees
From: Bob Dickey
As we reach the mid-point of the year, the economic recovery is not happening as quickly or favorably as we had hoped and continues to impact our U.S. community media organizations. We have made continued progress on the many initiatives underway to seek new sources of revenue, build a world class sales force and better serve our customers through watchdog reporting and stronger Sunday newspapers. While we are seeing improved circulation results and audience growth, weakness in the real estate sector, slow job creation and now softer auto ad demand continue to challenge revenue growth in the division.
National advertising remains soft and with many of our local advertisers reducing their overall budgets, we need to take further steps to align our costs with the current revenue trends. Each of our local media organizations faces its own market conditions, challenges and opportunities. Therefore, it has been up to each local publisher to determine his or her unique course of action.
While we have sought many ways to reduce costs, I regret to tell you that we will not be able to avoid layoffs. Accordingly, approximately 700 employees within USCP, or about two percent of our company’s overall workforce, will be let go. Publishers will notify people today and we will make every effort to reach everyone by end of day. It is important to note that these decisions do not reflect individual performance and we thank and respect those employees for their work. We will do everything we can to help them and to minimize the impact on our other employees going forward. In an effort to reduce the number of people being let go, there will be furloughs in the coming months but they will be limited only to those on the USCP corporate payroll who make over a certain salary. You will be notified by your publisher if you are among this group.
These have been extremely difficult and painful decisions to make. I know the impact is felt by everyone within USCP and companywide.
I appreciate and thank you for all that you do to create and deliver award-winning journalism to our customers and communities every day. Even under these challenging circumstances, I know you will continue to do so and your efforts are greatly appreciated by our customers and colleagues within Gannett.
As always, please feel free to email me directly at HYPERLINK “mailto:rdickey(Replace this parenthesis with the @ sign)gannett.com” rdickey(Replace this parenthesis with the @ sign)gannett.com with any questions you may have.
Regards,
Bob
Robert J. Dickey
President
A Bloomberg story gives a quick summation of how quickly and dramatically Gannett advertising has dried up:
Gannett’s revenue declined for four years in a row to $5.44 billion in 2010, from $7.44 billion in 2007. In the first quarter, revenue dropped 3.7 percent to $1.25 billion and net income fell 23 percent to $90.5 million. Gannett closed up 40 cents, or 2.9 percent, at $14.16 in New York Stock Exchange trading. The stock has declined 6.2 percent this year.
More about the cuts at Gannett:
“Gannett Laying off 700 More Workers Amid Ad Slump” (ABC News)
“Revenue Still Down, Gannett Lays off 700 Employees” (New York Times Media Decoder blog)
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