Citing a “difficult advertising market” newspaper publisher McClatchy (NYSE: MNI) says it will eliminate about 1,400 positions through voluntary and involuntary means. That comes to about 10 percent of the company’s total workforce. In a statement, the company said its workforce had already dropped by about 13 percent over the last two years, strictly through voluntary measures, but the worsening conditions of the industry require the new measure. Cost reductions are paramount for everyone in the industry, and McClatchy expects the move will reduce expenses by $70 million annually. Release.
So how bad is this ad environment? In a separate announcement, the company says May revenue was down 15.1 percent, and that ad revs fell 16.6 percent. The classifieds business continues to get gutted, falling 27.4 percent year-over-year. Mitigating things slightly, though not nearly enough, were digital revenues up 12.9 percent for the month. Release.
Staci adds: E&P has some of the details, including wide discrepancies in how cuts are being applied. for instance, the Miami Herald will lose 17 percent of its total staff (250 full-time jobs), the Charlotte Observer will cut 11.1 percent (123 jobs) and the Sacramento Bee, 8.1 percent (86 jobs, 46 through layoffs). The Fort Worth Star-Telegram announced a 10 percent cut and the combining of some sections coupled with increased subscription rates. That’s right, we’ll give you less and charge you the same rates or even more — if it works for consumer packaged goods like cereal and ice cream, why not newspapers?