Newsroom massacre: Gannett wields the chain-saw


UPDATED AT THE END

Gannett, one of the first and worst of the giant chains to swallow up America’s independent newspapers, announced another newspaper massacre this week, with 700 employees getting the axe.

From news biz blogger Jim Romenesko:

That’s about 2 percent of the workforce, according to Gannett US Community Publishing division president Bob Dickey. “The economic recovery is not happening as quickly or favorably as we had hoped and continues to impact our U.S. community media organizations,” he says in a memo that’s posted below. “Publishers will notify people today and we will make every effort to reach everyone by end of day.” In March it was disclosed that Gannett CEO Craig Dubow received a $1.25 million cash bonus and had his salary doubled.

David Kaplan writes at paidContent.org that the layoffs are just part of the bad noew for Gannett employees:

On top of the 700 job cuts, Gannett will once again use mandatory unpaid furloughs for executives over a certain pay level to save money in the face of what Dickey said was soft national and local advertising.

Here’s the impact of the bloodletting at one newspaper, by Kevin Osborne of Cincinnati’s City Beat:

Another round of layoffs hit Cincinnati’s only remaining daily newspaper this afternoon. Various reports indicate between 12 and 20 people were let go at The Enquirer.

Among staffers reportedly laid off were Joe Fenton, assistant metro editor; Kenneth Amos, director of news and operations; Sharon Morgan, editorial page assistant and ex-readers representative; and Bruce Holtgren, digital content producer.

Also laid off were Gary Osborne, director of information technology; C.E. Reutter, digital content producer; Jeff Tindall, digital content producer; and Greg Watson, area circulation manager.

The Enquirer is owned by Virginia-based The Gannett Co., which also owns USA Today, more than 100 newspapers nationwide and 23 TV stations.

More than 1,200 employees were laid off at Gannett’s newspaper holdings nationwide in 2009, including 101 people at The Enquirer.

Also, Enquirer employees have been required to take several rounds of unpaid leave during the past two years.

And here’s the story from Indianapolis, via The Gannett Blog, where layoffs hit employees at The Star:

The Indianapolis Star on Tuesday laid off 62 employees, including more than 15% of its newsroom staff in the latest round of cost-cutting by Gannett, the newspaper’s parent company.

Among those laid off in Indianapolis were 26 newsroom employees, including 12 copy editors and eight reporters, mostly those covering suburban news. The Star also eliminated 19 open positions, said Robert King, the newspaper’s religion and philanthropy reporter and president of the Indianapolis Newspaper Guild.

“The Indianapolis Star, I’ve been told repeatedly, continues to make money,” King wrote in an e-mail. “Yet, Gannett, and its corporate bosses in Virginia, seem to view workers not as assets but as liabilities on a balance sheet.”

More details on the Indianapolis layoffs from Newspaper Guild local president Bobby King:

[T]he more in-depth analysis shows that Gannett Co. Inc., the Star’s parent company, didn’t like the looks of its bottom line. The Star is still turning a profit. Its editor and publisher have said that repeatedly in recent weeks. But the Star’s revenues have been on the decline. Translation: The Star is making money, just not as much as it once did.

So, the answer that Star publisher Karen Crotchfelt came up with was to gut suburban coverage, eliminate an entire layer of copy editors (that last line of defense which separates us from the animals in the blogosphere) and make a nip here and a tuck there to reduce expenses. Crotchfelt didn’t sugar coat things. Asked a question about the prudence of such cuts at a time when her corporate bosses are getting six-figure bonuses, she answered straightly: That’s how the corporate world works — boards of directors set profit targets, execs try to meet them, if they do they get bonuses. She said it well, I thought, and with the precision of an oncologist delivering word the cancer is malignant.

In Fort Meyers, Florida, the layoffs came even after county officials had paid the company to create 105 new jobs, according to WBBH, the local NBC affiliate:

In March, Lee County gave $105,000 to the Gannett Corporation – owner of the News-Press. The money was an incentive to create 35 new jobs. But Tuesday the paper fired 14 people.

We learned 14 employees were laid off. Among those losing their job was long-time editorial cartoonist Doug McGregor.

The warning signs for layoffs were clear with News-Press employees suffering pay cuts through furloughs.

So in March, Lee County’s economic development arm awarded Gannett that $105,000.

“It’s national jobs that they could have located anywhere,” said Jennifer Berg, with the Lee County Economic Development Office.

After the 14 employees were laid off at News-Press, we asked Jim Moore, also with the Lee County Economic Development Office, whether he still thinks the investment was a good one.

The layoffs hit the chain’s Des Moines Register especially hard, according to Bleeding Heartland, an Iowa political blog:

Five months into Rick Green’s tenure as editor of The Des Moines Register, the newspaper is culling its newsroom staff again.

The 13 employees laid off this week include senior reporter Jane Schorer Meisner, who won a Pulitzer Prize for public service in 1991. I vividly remember her series of reports about a rape victim who agreed to let the Register publish her name.

Award-winning photographer John Gaps III lost his job too and told KCCI-TV, “I was being paid very well. And I earned that pay. I earned every dollar of it. But when it comes down to it, there comes a point where they can’t afford you any more.”

According to WHO-TV, Washington bureau reporter Philip Brasher is also getting the ax. That will hurt the Register’s coverage of Congress and federal government news affecting Iowa. Coverage from the capital suffered when Jane Norman was laid off in 2008 after 20 years of working for the Register.

Former Register Editor and CEO wrote an op ed on the cuts, which was rejected by the editors. Here’s an excerpt via Nieman Watchdog:

This state went for a generation or two without a scandal, in large part because The Register reporters were the state’s hounddogs sniffing out wrongdoers and the editorial writers were the watchdogs snuffing out wrongdoings. With every “downsizing,” with every “right-sizing,” with every layoff, more wrong-doers –  self-serving politicians, self-dealing officials, self-centered businesses – were given a pass.

Now, there will be even more passes.

The closing of the Washington bureau is especially sad. In its day, it was famous for its reporting on agriculture and the environment – its reporters won five Pulitzer Prizes – and it was feared and admired throughout government.

But that was then, and now is now. Now, the choices that editors and reporters must make at The Register will become vastly more difficult – what should be covered, what can be ignored?

And from Rachel Kaufman of Media Jobs Daily, some especially troubling news from Kentucky:

According to Louisville.com, the Courier-Journal laid off 50 employees, 24 from the newsroom, and is integrating its weekly arts & entertainment supplement into the main paper. The paper is also cutting back on its local coverage, with about half the staff assigned to “Neighborhoods” (weekly geography-based editions) losing their jobs and the paper may be reducing the number of geographic locations covered.

According to WPFL the paper has also eliminated its state house bureau.

It’s that last sentence which we find especially troubling. Louisville in Kentucky’s second largest city, trailing Lexington by less than 4,000 people. Gannett’s move deprives readers in the state’s second of vital coverage of state government, one of the basic rationales for a metropolitan newspaper’s existence.

The layoffs weren’t the first announced this year by Gannett as Kaufman reported for Media Jobs Daily in January:

Three Gannett-owned papers in New Jersey will be cutting their newsrooms in half, reports Gannett Blog.

Collectively the newsrooms of The Daily Record, Courier News and Home News Tribune employ 100 people.

All of them, it seems, will need to reapply for their jobs. According to the memo obtained by Gannett Blog, though, the application process will be a game of musical chairs, as 99 people will be competing for 53 positions.

And in Nashville, here’s the picture about this month’s layoffs at the Tennessean from J.R. Lind of the Nashville Post:

Bob Faricy, The Tennessean’s vice-president of market development, confirmed reports that 14 non-newsroom employees were laid off at the daily newspaper on Tuesday and 10 to 20 newsroom employees will be let go in the coming weeks, though he said there was “no hard date” for the newsroom layoffs.

These layoffs are the latest in a series of job cuts for the publication. In 2009, 35 employees were eliminated at The Tennessean. Late in 2008, 92 jobs were slashed.

Sources indicate the newsroom employees will come from The Tennessean and not from the suburban satellite newspapers.

In Phoenix, the news is equally bad, according to Ray Stern of the local New Times:

About 40 people have been laid off at the Arizona Republic, which also announced plans to close a Chandler press that prints USA Today and various inserts.

The local pink slips come as part of a 2 percent layoff at Gannett’s publishing division nationwide. About 700 people are losing their jobs.

Publisher John Zidich, in a Republic article today, cites weak national revenue at Gannett as part of the reason. As with layoffs at the state’s largest newspaper in mid-2008, late 2008 and 2009, the limping economy also is blamed.

Some Republic staffers heard the news well after others — because they were on mandatory, unpaid furloughs announced last month.

Gannett’s California holdings include the Palm Springs Desert Sun, where six layoffs were announced, according to Darryl L. Flowers of the Fairfield, Montana, Sun Times.

We’ve not found any news of layoffs at the chain’s other three California papers, the Salinas Californian, the Tulare Advance-Register, and the Visalia Times-Delta.

So what does it mean?

Gannett’s most singular achievement was the creation of the country’s first national general interest newspaper, USAToday, sometimes called McPaper by folks in the ink-strained-wretch set trade.

According to Agence France-Presse, no layoffs are planned at USA Today, and a chain official blamed the layoffs at other outposts of the Gannett’s empire on the ongoing economic collapse:

Gannett‘s net profit fell 23 percent in the first quarter of the year as a double-digit boost in digital revenue failed to make up for a continued print advertising slide.

Revenue was down 3.7 percent to $1.25 billion in the quarter.

John Reinan, writing for MinnPost.com, wrote about the chain’s health back in February, offering some numbers for the chain’s national paper:

Gannett is better at making money than any other newspaper company. So even discussion of such a move tells you all you need to know about the health of its flagship property. USA Today’s circulation, which consistently averaged about 2.3 million daily during the past decade, is down more than 20 percent, to about 1.8 million. The Wall Street Journal has overtaken it as America’s largest paper.

Ad pages are down even more sharply, from 1,045 in the fourth quarter of 2007 to 680 in the fourth quarter of 2010 — a drop of 35 percent. And, according to Hopkins, USA Today’s newsroom staff has been cut by about 25 percent during that same period.

USA Today was launched on 15 September 1982. It represented a radical departure from traditional newspaper journalism, featuring large, splashy graphics and very, very shot stories, written in a breezy style.

In many respects, the newspaper anticipated the digital news world. Veteran hjournalist Ben Bagdikian, then teaching at UC Berkeley, didn’t like what he saw after the first issues rolled out, declaring it then “a mediocre piece of journalism” and “no gain for the reading public, which gets a flawed picture of the world each day.”

Fifteen years later, in an interview with American Journalism Review, he would temper his critique as the paper expanded its reporting, calling it a “a much more serious newspaper. They have abandoned the idea that every person who picks up the paper has an attention span of 30 seconds.”

We’ve never been fans of the paper, even in is later incarnation. And now, as the chain pares its staff, the paper is becoming much more like its earlier incarnation.

On a grander scale, what’s happening at Gannett is little different than what’s been occurring over the past decades, as newsrooms have pared their staffs time and again, eliminating beats of vital importance to communities.

One of the many factors leading to the collapse of journalism was the takeover of newspapers by chains like Gannett. While newspaper-owning families were often content with single digit profits, chains demanded twenty percent and more, because shareholders — mostly large institutional investors — demanded high returns. Takeovers made consolidations and layoffs inevitable, and as papers offered less news, they became less essential for readers.

Then, as two-income families became the rule, people had less time to read. Then came the Web, Google, and all the rest, and tired people found they could get specific information within seconds. Newspapers were becoming irrelevant, or so folks thought.

But democratic governance depends on an informed electorate, and with the media pandering to our primate-level desires and fears, we become easy prey to manipulation.

We don’t have any easy answers. And, yes, our interest is partly selfish, since the jobs we want simply don’t exist any longer. But our fear is for this country, and what little control we as citizens retain over the institutions holding power over us.

Newspaper journalists, when they can do their work, are society’s diagnosticians, looking for problems and opportunities in the body politic. As their numbers dwindle, our ignorance increases at the very moment we need clear, in-depth portraits of the forces playing out in our lives.

UPDATE

The conscienceless corporation

Our prime directive when looking at the operations of corporations is simple: Always remember that corporations lack consciences.

The best papers were worked for were owned by people, who felt that profits came with an obligation to serve the community.

While they tended to be older white males, the best of them really felt a sort of noblesse oblige. They hired reporters who didn’t share their politics to conduct investigations into the very social milieu from which they sprang.

And, in the old days, many communities had a second, third, and sometimes a fourth paper, with one publisher being willing to look into affairs and events a rival publisher might duck.

The system was never perfect, but communities then were much better informed.

But corporations, faced with the threat of losses of advertisers and circulation will chose the “safe” course of action, the one that ensures the most profits. Besides, it’s the course that satisfies the corporation’s own prime directive: When faced with a choice of two actions, one which benefits the community but harms profits versus one which ensures profits but harms the community, the corporation is obligated to go for the green. It’s the corporation’s fiduciary responsibility to the shareholder, a doctrine enshrined by the same courts which conferred civil rights on the corporation.

In that light, consider this 11 April story from New York Times reporter David Carr:

Just in case Gannett employees thought 2011 might bring better news after years of layoffs and furloughs, the year was just four days old when a note landed in the in-box of people who work for the community news division saying, once again, they were required to take an unpaid week off.

After explaining that revenues at the newspaper giant continued to be soft and the outlook was uncertain, Robert J. Dickey, Gannett’s president of U.S. Community Publishing, said, “I know furloughs are very hard on you and your families and I thank each of you for the continued commitment and great work.”

Mr. Dickey made it clear that not only did the company’s executives feel their pain, they would share the sacrifice, noting that he too would take a furlough and that Craig A. Dubow, the chief executive, and Gracia C. Martore, the president and chief operating officer, “each will be taking a reduction of salary that is equivalent to a week’s furlough.”

But as it turns out, the buck stopped just short of Mr. Dubow and other executives. Mr. Dubow had agreed to lower his salary by 17 percent through 2011, but then again, last month he received a cash bonus of $1.75 million for 2010 and Ms. Martore received $1.25 million. For 2010, they were also awarded stock, options and deferred compensation that would bring their combined packages to $17.6 million if the company and its stock hits certain targets.

A company spokeswoman pointed out that 70 percent of their compensation was noncash and dependent on future performance. In fact, the top six executives at the embattled publishing company would receive 2010 compensation packages of more than $28 million if the company does very well, which seems unlikely, but the symbolism remains.

The savings from two years of mandatory furloughs for the rest of Gannett employees: $33 million. Well, that didn’t go very far, did it?

Read the rest.

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