Another major round of layoffs announced at NJ newspapers following Gannett acquisition
Gannett acquired the The Record (Bergen County) and a group of community newspapers just last year, but already two big rounds of layoffs have been announced, and readers are not happy with the changes they have seen in print or online
The newspaper chain Gannett acquired The Record (Bergen County, New Jersey) and affiliated community newspapers in June of last year. “Gannett continues to execute on its local market growth strategy,” Bob Dickey, president and CEO of Gannett, said at the time.
In September, however, Gannett had another announcement: there would be layoffs, as 130 newsroom positions were eliminated.
Once again, layoffs are said to be part of an effort to build digital.
“We remain committed to transforming the North Jersey Media Group into a digital powerhouse in response to the unprecedented change sweeping throughout our industry,” said Nancy A. Meyer, president of NJMG.
Gannett did not announce any new hires tied to any digital initiative.
Gannett is attempting a roll-up strategy, acquiring papers in local markets with the idea that the combination of newspapers across the country can attract new digital advertising. The company awkwardly pursued Tribune Publishing before its name change to tronc, but only managed to drive up the target’s stock price.
“How will slashing journalist jobs help “meet the growing digital demands of readers”? Sounds like typical counterintuitive Gannett-speak to me,” wrote one reader on the story about the layoffs on NorthJersey.com. “Shame on you, Bob Dickey, for destroying yet another NJ paper.”
Readers have complained about more than the staff cutbacks, they have also noticed a change with the website, which uses the same Gannett design as other papers (TNM considers the Gannett sites to be the worst in the business).
Gannett will be announcing earnings on February 9, which explains the timing of the layoffs. Companies generally like to announce layoffs ahead of earnings reports so as to be able to explain that they have already made changes in reaction to poor earnings.
The newspaper publisher reported a loss of $24.2 million in the third quarter, though the company remains slightly in the black.
“To combat the continuing challenges in print advertising trends, the company is implementing cost saving initiatives, which include reductions throughout our operations as well as in corporate support and related functions,” John Zidich, president of Domestic Publishing, said in the Q3 earnings statement. “We expect to recognize approximately $6 million of payroll related savings and $4 million of non-payroll savings in the fourth quarter of 2016. On an annual basis, we expect the payroll related savings to total $30 million and impact approximately 2% of our workforce.”
Gannett completed the spin-off of its newspaper and broadcast businesses in June of 2015, with the broadcast side being renamed TEGNA, and the print side retaining the Gannett name. At the time of the spin-off, Forbes gave a thumbs up to TEGNA due, in part, to the fact that it got the important digital assets of Cars.com and CareerBuilder.
“On the other hand, Gannett Co. operates the less promising publishing business with declining traditional print advertising revenues<" contributor Joe Cornell wrote at the time.