Tribune Co. to cut 250 jobs - Papers in Chicago, Los Angeles affected
Tribune Co. to cut 250 jobs - Papers in Chicago, Los Angeles affected
By Michael Oneal
Copyright © 2007, Chicago Tribune
Published April 24, 2007
Tribune Co. executives said Monday they plan to cut as many as 250 jobs in Chicago and Los Angeles as the Chicago-based media conglomerate struggles with declining advertising and circulation revenues.
The Chicago Tribune Media Group will eliminate 100 jobs, or 3.4 percent of its 2,900 employees. The Los Angeles Times Media Group will cut between 100 and 150 of its 3,491 positions, or up to 4.3 percent.
Executives in both cities said they would strive to reach their targets largely through a voluntary buyout program that would give qualified employees one week of salary and benefits for every six-month period they have worked for the company.
Involuntary layoffs would follow to the extent they are needed. The Los Angeles Times may also let employees switch to a four-day work week for 80 percent of their pay and limited benefits.
Noting that the Chicago Tribune group's first-quarter revenue dropped 4 percent from a year ago, Scott Smith, president of Tribune Publishing and publisher of the Chicago Tribune, said in a memo to employees that full-year 2007 revenue will likely trail last year's. Giving voice to a bind constricting the entire industry, Smith said, "We need to achieve additional expense savings at the same time we focus on revenue growth."
The Denver Post also announced plans Monday to accept buyout packages from as many as 37 newsroom employees. MediaNews Group owns The Denver Post.
Doing more with less has become a fact of life in the newspaper business. And it has taken on special urgency at Tribune Co. since it agreed to a complex deal with Chicago billionaire Sam Zell to take Tribune private through an employee stock ownership plan.
The deal will add $8.4 billion in debt to the $5 billion already on Tribune's balance sheet. And to pay down that debt, Tribune, in coming years, will have to at least maintain last year's level of around $1.4 billion in cash flow.
Los Angeles Times Publisher David Hiller said revenue in Los Angeles also fell 4 percent in the first quarter and cash flow fell 13 percent, slightly worse than the company as a whole. Online revenue, he said, was growing at about 20 percent, but "new media is not yet big enough to offset the decline on the print side."
Times Editor James O'Shea, who took over the top post in the fall, after his predecessor, Dean Baquet, stepped down after opposing layoffs, has vowed to fight further cost cutting.
"I consider the loss of each and every journalist or employee in this company a failure," he said in a memo to his staff. "In a perfect world, I would prefer that every employee stay here. Unfortunately, we don't live in a perfect world."
O'Shea said he is encouraged that Zell has said newspapers are still a good business.
But he made no secret of his frustration with having to cut jobs in Los Angeles while executives in Chicago get bonuses for selling the company.
"A number of you have asked me how we could cut jobs to save millions of dollars at a time when a group of unnamed executives will reap bonuses and stock grants worth millions when the change of ownership is complete," O'Shea wrote. "I cannot -- and will not -- defend any such bonuses. Frankly, I understand why you are angry about these plans."
The Los Angeles Times reported O'Shea might have to cut as many as 70 positions in the newsroom. Chicago Tribune Editor Ann Marie Lipinski said it is unclear how many she will have to cut. But she said she hopes to reach her target through buyouts and the elimination of open positions -- not involuntary layoffs.
"We're working in the newsroom to focus on voluntary cuts," she said.
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mdoneal@tribune.com
By Michael Oneal
Copyright © 2007, Chicago Tribune
Published April 24, 2007
Tribune Co. executives said Monday they plan to cut as many as 250 jobs in Chicago and Los Angeles as the Chicago-based media conglomerate struggles with declining advertising and circulation revenues.
The Chicago Tribune Media Group will eliminate 100 jobs, or 3.4 percent of its 2,900 employees. The Los Angeles Times Media Group will cut between 100 and 150 of its 3,491 positions, or up to 4.3 percent.
Executives in both cities said they would strive to reach their targets largely through a voluntary buyout program that would give qualified employees one week of salary and benefits for every six-month period they have worked for the company.
Involuntary layoffs would follow to the extent they are needed. The Los Angeles Times may also let employees switch to a four-day work week for 80 percent of their pay and limited benefits.
Noting that the Chicago Tribune group's first-quarter revenue dropped 4 percent from a year ago, Scott Smith, president of Tribune Publishing and publisher of the Chicago Tribune, said in a memo to employees that full-year 2007 revenue will likely trail last year's. Giving voice to a bind constricting the entire industry, Smith said, "We need to achieve additional expense savings at the same time we focus on revenue growth."
The Denver Post also announced plans Monday to accept buyout packages from as many as 37 newsroom employees. MediaNews Group owns The Denver Post.
Doing more with less has become a fact of life in the newspaper business. And it has taken on special urgency at Tribune Co. since it agreed to a complex deal with Chicago billionaire Sam Zell to take Tribune private through an employee stock ownership plan.
The deal will add $8.4 billion in debt to the $5 billion already on Tribune's balance sheet. And to pay down that debt, Tribune, in coming years, will have to at least maintain last year's level of around $1.4 billion in cash flow.
Los Angeles Times Publisher David Hiller said revenue in Los Angeles also fell 4 percent in the first quarter and cash flow fell 13 percent, slightly worse than the company as a whole. Online revenue, he said, was growing at about 20 percent, but "new media is not yet big enough to offset the decline on the print side."
Times Editor James O'Shea, who took over the top post in the fall, after his predecessor, Dean Baquet, stepped down after opposing layoffs, has vowed to fight further cost cutting.
"I consider the loss of each and every journalist or employee in this company a failure," he said in a memo to his staff. "In a perfect world, I would prefer that every employee stay here. Unfortunately, we don't live in a perfect world."
O'Shea said he is encouraged that Zell has said newspapers are still a good business.
But he made no secret of his frustration with having to cut jobs in Los Angeles while executives in Chicago get bonuses for selling the company.
"A number of you have asked me how we could cut jobs to save millions of dollars at a time when a group of unnamed executives will reap bonuses and stock grants worth millions when the change of ownership is complete," O'Shea wrote. "I cannot -- and will not -- defend any such bonuses. Frankly, I understand why you are angry about these plans."
The Los Angeles Times reported O'Shea might have to cut as many as 70 positions in the newsroom. Chicago Tribune Editor Ann Marie Lipinski said it is unclear how many she will have to cut. But she said she hopes to reach her target through buyouts and the elimination of open positions -- not involuntary layoffs.
"We're working in the newsroom to focus on voluntary cuts," she said.
----------
mdoneal@tribune.com
posted by Carlos T Mock at 9:28 AM
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