The memo said that McClatchy will freeze pension plans and temporarily suspend the company match to its 401(k) plans, effective March 31. McClatchy said it will also cut an additional $100 million to $110 million, or approximately 7% of its 2008 cash expenses, over the next 12 months, beginning later in the first quarter of 2009.
"Here at the Star-Telegram we have seen an unprecedented loss in advertising revenue with many of our best customers either going out of business or closing locations, and employment advertising dropping to all time lows. In response to these losses we are developing plans to reduce expenses," said Gary Wortel, president and publisher of the
, in the memo. "Unfortunately, these cuts will include position eliminations."
It was not clear how many positions would be affected. McClatchy announced a $21.7 million loss and offered bleak guidance in its fourth-quarter report Thursday.
"We continue to respond to the recession by reducing costs and intensifying our pursuit of new revenue opportunities," said McClatchy CEO Gary Pruitt on a conference call Thursday. "In the fourth quarter, we reduced cash operating expenses by 14.4% excluding severance costs and despite higher newsprint prices."
Previous cuts were made as recently 2008, a point Wortel addressed in his memo. "We had hoped that previous cuts would be sufficient to see us through the sharp revenue declines affecting our industry," Wortel said. "Instead, we must continue to respond to the unprecedented and deepening financial crisis that is threatening not only our industry, but all kinds of businesses in almost every sector of the economy."
The Wall Street Journal
is laying off 14 editorial employees, according to the All Things Digital Web site. Both the site and the
are owned by Dow Jones, a unit of
The site posted a letter from publisher Robert Thomson, who said there are no plans for layoffs at Dow Jones Newswires. The 14 layoffs at the paper follow the voluntary departures of 11 journalists in the past couple of months, the memo indicated.
Layoffs and restructurings have become commonplace in the media industry in recent months as the recession in the U.S. has put the brakes on advertising spending. Among recent cuts,
Dallas Morning News
said it would lay off
, and the
New York Times'
set plans to eliminate up to
50 news positions