Layoffs Imminent at Major East Bay Dailies

John Armstrong, publisher of the Oakland Tribune, the Contra Costa Times, and several other East Bay daily newspapers told reporters, photographers, and editors last night to expect layoffs “in the weeks ahead.” In an e-mail to all employees that was time stamped at 7:57 p.m., Armstrong said the layoffs were due to “the slumping advertising market or as a result of changes in the way we will conduct our business.” See the full e-mail after the jump.

Newspaper staffers had expected Armstrong’s announcement, but were still angered by it. Several immediately denounced his reasoning, and wondered openly why Armstrong, whose exact title is “vice president of the California Newspaper Partnership,” and other MediaNews top managers have yet to come up with a way to address the newspapers’ sagging revenues other than through staffing cuts. “What’s interesting to me is that these executives, who have all been in leadership positions for some time, continue to blame advertising, without taking a hard look at themselves and the way they’ve managed the papers during this decline,” said one staffer for ANG Newspapers, which includes the Trib, the Hayward Daily Review, the Fremont Argus, the Tri-Valley Herald, and the San Mateo County Times.

Armstrong’s e-mail comes on the heels of another layoff announcement at the San Jose Mercury News, the sister paper of the Contra Costa Times and the Tribune. Less than two weeks ago, George Riggs — Armstrong’s boss at MediaNews — said the company planned to cut 101 staffers, including 40 from the newsroom. Armstrong also blamed declining ad sales. Members of the San Jose Newspaper Guild, the union that represents Merc reporters, photographers, editors, and advertisers, viewed that layoff announcement as a threat by MediaNews to force the union to agree to its contract demands. MediaNews wants to do away with minimum salaries at the Merc — now about $55,000 — so it can hire new employees at lower wages.

The twin layoff notices also come in stark contrast to the announcement made by MediaNews CEO Dean Singleton when he purchased the Mercury News and Contra Costa Times from McClatchy Newspapers earlier this year. Singleton told staffers at both papers that he had no immediate plans for layoffs and touted the synergy that could be attained from owning all the major dailies in the East Bay and South Bay. He also talked about making the papers better. “I don’t know how you can promote quality when you don’t have enough reporters to cover the news,” one angry ANG staffer said today.

Armstrong, however, did assure employees at ANG and the Times that there would be no wage cuts or a wage freeze. MediaNews also has not asked for wage cuts of existing Merc employees. He also said the company has no plans to eliminate any of the newspapers. There had been some speculation that the company would consolidate the Valley Times and the Tri-Valley Herald, which both serve Dublin, Pleasanton, and Livermore.

Here’s Armstrong’s Halloween night e-mail:



    As you know, our newspapers have struggled with declining advertising and circulation revenues in recent months, and we are not alone. The newspaper industry generally is under siege, and much of the
    problem stems from what appears to be a permanent shift of advertising dollars from print to interactive channels.

    Because we do not believe these problems are transient in nature, we have taken on the challenge of redesigning the newspaper business model on which we have relied for as long as most of us can remember. The new model requires that we become as efficient as possible in everything we do.

    In recent weeks, all the newspaper companies in the California Newspapers Partnership, including the Contra Costa Times and ANG newspapers, have been working on new budgets for the fiscal year
    that started July 1st and ends next June 30th. The Contra Costa Times and the San Jose Mercury News worked on their first budgets under CNP ownership (having been acquired Aug. 2); the previously-owned CNP papers, including those within ANG, worked on budget revisions to deal with significant revenue shortfalls in the July-September quarter.

    We presented these budgets to the CNP Board of Directors last Friday, and the Board approved them. Over the next several weeks you will receive more information on how we intend to implement the
    initiatives contained in these budgets. The initiatives are designed to reduce our costs of operations while minimizing the impact of these changes on the quality of our journalism and the level of our service to readers and advertisers.

    A number of rumors have come to my attention during this budgeting/rebudgeting process, and I want to respond to them now.

    Rumor: There will be wage cuts. Truth: The new budgets do not require wage cuts.

    Rumor: There will be a wage freeze. Truth: The new budgets do not require a wage freeze. We will continue to award merit increases based on individual performance.

    Rumor: There will be a consolidation of flags and mastheads. Truth: The new budgets allow us to continue our current stable of newspapers.

    Some employees also have expressed concern that there will be layoffs. Over the past several months, as revenue conditions have weakened, we have relied on attrition — not filling openings as they occurred in the normal course of business — to reduce the size of our organizations, but the attrition has not been adequate. Thus, some number of layoffs should be anticipated in the weeks ahead, either due to the slumping advertising market or as a result of changes in the way we will conduct our business.

    At the same time, I want you to know that VP/Advertising Mike Jung and VP/Circulation Dan Smith and their leadership teams are working on initiatives that will bring in new revenue. Every success on the revenue side lessens the need for us to make cuts on the expense side.

    As always, please don’t hesitate to fire your questions my way.

    John Armstrong

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