Following recent warnings of Q3 revenue declines due to the weak economy, The New York Times Co. (NYSE: NYT) is looking to cut 20 newsroom jobs by the end of the year, the NYT reported. The cuts would come through buyouts, as recently installed editor Jill Abramson said in a staff memo that there would be no layoffs.
There will also be some staff reductions on the business side though it wasn’t clear how many jobs would be lost in those departments. The cuts are expected to come from not filling vacant positions.
It also isn’t certain that Abramson will be able to keep her promise about not handing down layoffs. In December 2009, then NYT editor Bill Keller warned the paper would have to resort to layoffs after setting a target of 100 voluntary buyouts in late October of that year.
The NYT’s newsroom staff hit a high of around 1,300 people before 2008’s cuts. It now has roughly 1,250 more than any other U.S. newspaper. The buyout formula effectively works out to two weeks of pay for each year a staffer has been with the company. The most a staffer could get from a buyout is one year’s worth of salary.
Last month, NYTCO CEO Janet Robinson spoke at an investors conference and reiterated her early statement about Q3 trending a bit negatively.
The NYTCo is now expecting 8 percent declines in Q3 ad revenue, with a 10 percent drop in print, and even a 2- to 3 decrease in digital ad revenues, which are partly due to the About Group’s continuing troubles. At the end of September, About.com restructured its editorial operations team and said it would be dismissing 15 existing staffers, but adding 10 new ones.
Apart from About’s particular challenges, newspaper publishers in general have been losing the ground gained in 2010, as the wider ad recovery helped arrest the steep declines of the two previous years. As the NYTCo prepares for its Q3 earnings on Oct. 20, the most executives can do now is prepare investors for some more difficult times.
To the Staff:
We are announcing today a limited buyout opportunity to newsroom volunteers, both excluded staffers as well as those members of the Guild-Times bargaining unit covered by the existing print contract.
By limited, that means we are looking at fewer than 20 buyouts across the newsroom, among volunteers who see the offer as being to their financial advantage at this time. The offering to the newsroom is, in any event, wholly voluntary. No matter how many people do or do not raise their hands, no one in the newsroom – either Guild or excluded – will be laid off as a result of this program.
For excluded staff members, the buyout formula effectively works out to two weeks of pay per year of service, with a maximum of one year in salary. The existing formula for Guild members in general provides for three weeks of severance per year, capping at a maximum of two years worth of salary.
The Guild buyout formula is among the issues on the table in the current contractual negotiations between the company and the Guild, and the company has proposed that in the future, the Guild terms mirror those now available to excluded employees. But until the company and the union agree on a new contract and the membership ratifies it – hopefully in the coming months – the current buyout terms remain in effect.
While we remain as loyal as ever to Times journalism and journalists, the uncertain economy has posed a continuing and difficult challenge to The Times: how to rebalance our business for the digital age while remaining steadfast to the quality journalism that defines us?
As you all know, the company has consistently chosen to protect the journalism, even while cutting production and other business-side costs and continuing to demand exacting financial discipline in the way the newsroom itself marshals its resources and controls its spending. Even now, we field a newsroom staff about the same size as it was a decade ago, and continue to invest in new opportunities and new platforms for our content.
In conjunction with this offering in the newsroom, the business side is making a small adjustment in its own budget, mostly by eliminating some open slots. This is consistent with ongoing efforts among our colleagues in the business side departments, who have cut their own staff in half over the past decade.
As in previous buyouts, to ensure we do not cut too deeply in our journalistic muscle, we do reserve the right to turn down some volunteers who are in those areas of the newsroom where we feel we cannot reduce our numbers. It is for that reason, in part, that we have excluded those members of the Guild who are covered by the separate Digital contract.
Anyone who is eligible for this offering and interested in volunteering should contact Bill Schmidt’s office by Monday, Oct. 24, and we will get you a copy of the package. You will have 45 days from then to decide whether or not you want to formally apply for a buyout.
Jill, Dean and John