Newspapers have become so thin that they have nothing more than a few pages of news, a modest number of stories about sports and a few on lifestyle. The industry has been undermined by a drop in print advertising, relatively low prices for online ads, and fewer and fewer people who will pay for newspaper subscriptions, either online or printed. Almost no American papers have dodged these problems. At the top of that very short list are The New York Times and Washington Post.
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Newspaper companies have tried to shrink their way to profitability. This always involves layoffs, and often the shutdown of printing plants. Many newspaper companies have cut more than half their workers. If this allows newspapers to be profitable, it is only temporary. Consumers will not buy papers with sharp drops in the quality and quantity of their stories.
Another reason for cuts is demanding shareholders. Among these are hedge funds that have bought into or controlled newspaper companies. They keep cash flow high by ongoing cuts in expenses.
After what seemed like a respite in industry layoffs, Lee Enterprises has cut or will cut 400 jobs. Axios reports that “Lee began laying off dozens of employees in the past two weeks affecting publishers, human resources professionals, IT professionals and people in print production and advertising, multiple sources familiar with the cuts tell Axios.” Part of the reason given is pressure from hedge fund Alden, which is among the largest newspaper owners in the country.
Lee says it provides “local news, information, and advertising.” It claims it is the fastest-growing company in the industry, which is impossible for it to prove. It also claims, “no competitor can match the indispensable local news.” As it layoffs more people, that becomes less and less likely.
Who can hold the line on layoffs and what will certainly be an erosion of editorial quality? Mary E. Junck, Lee’s board chair, and Kevin D. Mowbray, the president and chief executive, are at the head of that list. Mowbray made $2,174,611 last year.
Management at Lee has put layoffs ahead of their jobs. Maybe that will not matter over time, but it does today. They should admit they cannot fix Lee, they have shown, without undermining its papers.
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