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U.S. Knight Ridder to Cut Jobs at Most Papers
Knight Ridder plans to eliminate jobs at most of its 32 daily newspapers in the face of plunging advertising revenue and rising newsprint prices.
The nation's second-largest newspaper company did not specify how many jobs will be lost in the reorganization or where the cuts would occur. San Jose-based Knight Ridder employs about 22,000 workers.
Knight Ridder Chief Executive Tony Ridder said in a statement Friday that the number of jobs lost will vary from paper to paper, based on local market conditions. Knight Ridder will offer early retirement packages in an effort to avoid layoffs.
Other newspaper publishers have also announced staff reductions recently in response to the steep advertising slump. Dow Jones & Co., publisher of The Wall Street Journal, laid off 202 workers and eliminated 300 open positions, and The New York Times Co. made a second round of job cuts at its online unit and plans to offer buyouts to other employees.
Earlier this month, Knight Ridder reported a sharp decline in first-quarter profits. Excluding one-time gains or losses, income fell 31% to $47.8 million from $68.9 million.
Knight Ridder's financial goals at the San Jose Mercury News became a hot topic in the industry last month after the veteran publisher, Jay T. Harris, resigned to protest the company's cost-cutting plans there.
Labor leaders representing Knight Ridder employees say the company already has eliminated jobs at two of its papers ¡ª the Mercury News and the Akron Beacon Journal in Ohio. The cuts, mostly affecting jobs outside the newsroom, have been made in the past few weeks.
After enjoying several years of increasing profits since Ridder became CEO in 1995, Knight Ridder expects earnings to decline this year because of an advertising slump and a sharp increase in the cost of newsprint.
After a 2.7% decrease in ad revenue during February, Knight Ridder's ad revenue fell 6% in March. The erosion this month "appears even more substantial," the company said.
"I never have seen a fall-off as sudden or as steep as this one. I don't know anyone who is confident of a near-term, or a dramatic, uptick," Ridder said.
At the same time, Knight Ridder's newsprint expenses are up by 20% from the same time last year. Newsprint typically represents a newspaper's second-largest expense after labor.
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