The Star Tribune this morning announced the layoff of 58 employees, about 3 percent of the newspaper’s workforce, and an indefinite wage freeze for all its nonunion employees, about 600 in total.
Publisher Chris Harte cited continuing revenue declines, the efficiencies of new technology and outsourcing in a morning memo to employees.
Three-fourths of the eliminated jobs are in the circulation department, which got the news at 9 a.m. meetings.
The exiting employees will receive the same severance given to about 140 employees who took voluntary buyouts last May, which is two weeks’ pay for every year’s employment and six months of health coverage.
At that time, the company hoped those cuts would be enough to stabilize finances, Harte wrote in the memo.
“Since then, the national and state economies have further weakened, and our key classified markets — real estate, automotive and employment — have fared even worse than the overall economy,” he wrote.
In a previous communication to employees, Harte said total revenue declined almost $75 million over the past two years.
The circulation cuts come as the outsourcing of home delivery to independent agents was completed, newspaper spokesman Ben Taylor said in an interview.
There are also reductions in single-copy delivery, as truck drivers assume duties previously performed by other staff, Taylor said.
The other quarter of eliminated jobs are scattered throughout the company, although Taylor stressed no journalism or ad sales jobs are being cut with this announcement.
However, last week two unions — the Guild and the Graphic Communications International Union — that represent seven photo technicians in the newsroom were told the company plans to replace most of them with technology. Taylor said he expects 1½ or 2½ positions to remain.
The wage freeze follows a freeze on the company’s 12 senior executives, including Harte, in January, the memo said.
Layoffs continue to be a part of the contracting newspaper industry, analyst John Morton said Monday.
Other recent announcements include the San Diego Union-Tribune, which cut 10 percent of its workforce; the Washington Post, which announced another round of buyout offers next month, and the Chicago Sun-Times, which just followed newsroom layoffs with an announcement it is now up for sale.
Anticipated price increases in newsprint will only add to newspaper companies’ already strained economics, Morton said.
“I had expected 2008 to be a duplicate of 2007, but now it’s beginning to look like it will be worse,” he said.
The announced cuts come as the Star Tribune brought in a consulting firm, Restructuring Associates, aiming for a labor-management alliance to look for cost-saving ideas.
But that move is unrelated, and the company is still aiming to meet with union leaders late this month to share its financials including the cost savings of today’s cuts, Taylor said.
At the same time, the Guild, which represents about 310 employees, mostly in the newsroom, is beginning preparations to renegotiate its contract set to expire July 31.
Harte stressed a long-term optimism in a statement he also released this morning.
While the Star Tribune continues to battle revenue declines, as are most media companies, he said, “We are a very strong and profitable company and by far the leading media organization in the Twin Cities.”
H.J. Cummins • 612-673-4671