Wednesday, November 20, 2013

Tribune reorganizing publishing, will cut 700 jobs

The Tribune Company announce in a memo to employees that it will be restructuring its publishing division to focus on digital operations and "streamlining" operations (which usually means centralizing jobs that had been done independently at its 8 daily newspapers).
"The new operational plan is going to change the company into one company with eight locations, as opposed to how we operate now which is eight individual and separate businesses," (Tribune Co. President and CEO Peter) Liguori said. 
The company hopes the move will trim costs to match the publishing division's declining revenues as it seeks to spin the publishing division into a separate company.  While remaining profitable, the publishing division's ad revenues fell by $84 million last year, and are already down another $62 million in the first nine months of this year.

The publishing division has already cut its expenses by 13% so far this year, primarily by reducing compensation costs through job cuts.  About 340 positions have already been eliminated in the division,  and the memo anticipates job cuts will double to around 700 by the end of the year.  Last year, the Tribune Co. eliminated about 800 jobs in its publishing division.

The strategy of using job eliminations to offset declining revenues, however, can only be effective if the revenue shortfalls don't continue.  In the face of continuing, industry-wide, long-term print advertising revenue declines (that aren't being replaced in full by digital revenue growth), cutting positions can only be seen as a stopgap measure.  And a risky one if the job cuts impact news content production and quality.

Source -  Tribune Co. reorganizes publishing unit, cutting nearly 700 jobsChicago Tribune

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