Gannett to Eliminate 1,000 Newspaper Jobs

Gannett, the McLean-based newspaper giant and publisher of USA Today, plans to cut 1,000 jobs, or about 3 percent of its workforce, according to a company memo.

Like most newspaper companies, Gannett is struggling with declining advertising and circulation and is trying to cut costs. Layoffs will account for about 600 of the positions targeted for elimination, the memo says, and should be completed by the end of this month. The rest will come from attrition.

In addition to USA Today, the nation's largest-circulation paper, Gannett owns 85 daily papers and 900 non-daily papers in the United States and Britain, as well as 23 television stations. The company is valued at $4.8 billion.

Gannett stock closed up more than 10 percent yesterday at $21.31, as Wall Street rewarded the pending reductions.

The job cuts will come from the company's community newspaper division, which includes the Arizona Republic, the Detroit Free Press and the Louisville Courier-Journal but not USA Today.

Gannett's newspapers reported disappointing second-quarter earnings last month, including a 13.6 percent drop in U.S. advertising revenue from the same period last year. The publishing division reported a 27 percent decline in operating income.

The company confirmed yesterday that the job cuts come in response to the earnings.

Each of Gannett's community newspaper publishers has been given a payroll dollar amount it must reach, based on how well the paper is doing and how much it has recently cut expenses, according to the memo, which went out Wednesday.

It is then up to each paper to determine what cuts will be made and to inform employees by today. For instance, the Courier-Journal said yesterday that it will lay off 15 employees by the end of this month.

"We would prefer no more reductions," Gannett's memo reads, "but we must keep expenses in line with revenue." The memo adds that if advertising and circulation continue to drop, further job cuts may be possible.

"These people leaving Gannett contributed to its growth and success," the memo reads. "We will thank them for their years of service and treat them in a way that acknowledges their valuable contributions."

Laid-off Gannett employees will receive one week of pay for each year of service, with a minimum of two weeks and a maximum of 52 weeks.

Most newspaper companies reported tough second-quarter earnings.

McClatchy Co., home to 30 newspapers including the Miami Herald, said yesterday that it is implementing a one-year wage freeze for all employees, following a 44 percent plummet in second-quarter earnings.

McClatchy has perhaps been battered hardest by the industry downturn, losing 95 percent of its value since 2005. The company recently said it would cut 10 percent of its workforce.

The Washington Post Co. dipped into the red for the first time in its 37-year publicly traded history last quarter, pulled down by declining revenue and the high cost of early-retirement packages taken by more than 200 employees.