Wednesday, September 21, 2005
New York Times Co. chops 500 personnel
The New York Times Company announced yesterday its second round of job cuts in four months. In May, the Times Co. had to eliminate 200 of its staff or 2% of its workforce (see previous posting), mostly resulting in contract buyouts which have cost the company more than it expected.
This time around, 500 positions, or 4% are set to be gradually cut over the next 6 to 9 months. 45 employees (3.75%) in the flagship New York Times newsroom will lose their job as well as 35 (6%) from the Boston Globe newsroom. NYT's executive editor Bill Keller also announced that the paper is not searching for any new employees at the moment. The cuts are blamed on slow advertising growth, apart from the company's digital holdings which are growing at double-digit rates.
Knight Ridder also announced 100 cuts in two of its papers' newsrooms: 75 at the Philadelphia Inquirer and 25 from the Philadelphia Daily News. The cuts were also attributed to a loss in advertising revenues. Additionally, the papers' publisher declared that overall revenues have been "flat" for the past few years.
These cuts, especially those at the New York Times Co., are a bothering but telling sign of the direction in which the newspaper industry may be headed. NYT Co., a huge operation and industry trendsetter, could provoke other large news companies to do the same in the face of a demanding Wall Street. For example, the California based publisher McClatchy, which has in recent years been a beacon of growth, also just announced that its earnings would be lower than expected in the third-quarter.
However, with double-digit advertising growth in its online divisions, several recent Internet company acquisitions, and an online subscription service, the New York Times may also be steering itself towards a more digital approach to business which other companies already have and will undoubtedly continue to follow.
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