SACRAMENTO, Calif. The McClatchy Co., battered by declining profits and revenue, announced a 10 percent companywide cut in its work force Monday.
The decision will eliminate 1,400 jobs through a combination of layoffs, voluntary departures and attrition.
The Tri-City Herald, which is owned by McClatchy, announced it will eliminate nine jobs, all through layoffs in the advertising, circulation and production departments.
There will be no layoffs in the newsroom, due largely to positions having been eliminated through previous attrition, said Executive Editor Ken Robertson.
We are still in position to provide the Mid-Columbia and our region with the largest and most experienced newsroom, said Herald Publisher Rufus M. Friday.
Were operating in a time of great change and challenge for our operations, for The McClatchy Company and for the newspaper industry overall, he said in a memo to employees.
He noted, We have more readers today than ever before for our newspaper, our website and our specialty products. Thats our most important measure of success for the future.
McClatchy has prided itself on avoiding across-the-board layoffs even as it has used buyouts and attrition to cut its head count by 13 percent since April 2006.
But with the company struggling and its stock price down about 80 percent in two years, McClatchy said it had to act more decisively to reduce costs as it transitions to a company more fully focused on the Internet. In a separate announcement, McClatchy said its May revenue fell 15.1 percent; ad sales fell 16.6 percent.
The effects of the current national economic downturn particularly in real estate, auto and employment advertising make it essential that we move faster now to realign our work force and make our operations more efficient, Chairman and Chief Executive Gary Pruitt said in a prepared statement. Im sorry this requires the painful announcement we are making today, but were taking this action to help ensure a healthy future for our company.
Mondays announcement could test McClatchys reputation as a publisher that can balance quality journalism with the incessant demands of Wall Street. Until now, it has been one of the few publishers to hold to a policy of no broad layoffs, although many of its papers have eliminated jobs through buyouts and attrition.
McClatchy is still viewed as a newspaper company that cares about quality, said John Morton, an independent industry analyst and consultant in Maryland. The cutback puts a dent in that, but its not a deep slash, he said.
Quite a few other newspaper chains have been making deep cuts aimed primarily at newsrooms, he said.
The job cuts are designed to save McClatchy about $70 million a year, as part of a larger plan to reduce total operating costs by $95 million to $100 million a year.
Pruitt, in the statement, said the cutbacks are part of a continuing, strategic vision for successful future operations, not solely a response to todays adverse conditions.
McClatchy is the third largest newspaper chain in the country. The companys 30 daily newspapers include the Miami Herald, the Kansas City Star, the Fort Worth Star-Telegram and the Charlotte Observer.